This contribution was originally published as part of the Chambers Global 2026: In-depth Overview: Waselius: Finland: Dispute Resolution: Most in Demand and is republished here with permission. The entire publication is available on Chambers and Partners website.
Arbitration in Finland: the FAI’s Central Role and the Upcoming Legislative Reform
Arbitration in Finland is, as a rule, pursued under the FAI rules
Although no official statistics exist on the number of ad hoc arbitrations conducted in Finland, most arbitrations seated in Finland are institutional. The Finland Arbitration Institute (FAI) is the leading, and effectively the only, domestic arbitration institution. Founded in 1911, the FAI is the oldest arbitration institute in the Nordics and is widely recognised for its trusted role in administering both domestic and international arbitrations.
According to FAI statistics, the most common countries of origin of parties in FAI-administered proceedings include Finland, Sweden, Estonia, Lithuania and Germany, as well as parties from countries outside Europe such as the United States and China. The most frequently disputed contract types are service agreements, construction agreements, and sale and purchase agreements.
The median duration of arbitrations conducted under the FAI Arbitration Rules is approximately nine months, measured from the transfer of the case file to the arbitral tribunal until the issuance of the final award. Under the FAI Expedited Arbitration Rules, the median duration is around three and a half months.
Arbitrator appointments made by the FAI reflect broad geographic diversity. Among the ten most common countries of origin of appointed arbitrators are Finland, Sweden, Norway, Germany, Switzerland and the United Kingdom.
Current central topic in the Finnish arbitration community: the reform of the Finnish Arbitration Act
In December 2025, the Ministry of Justice’s working group published a proposal for the complete renewal of Finland’s Arbitration Act. This is not yet law. The report will yet proceed through consultation, a government bill and parliamentary scrutiny, but based on the feedback that the reform has already received, it is likely that most of the proposed changes will materialise as part of the new act.
The current Act (967/1992) has provided a stable framework for arbitration in Finland but no longer reflects contemporary international practice, particularly compared to jurisdictions aligned with the 2006 amendments to the UNCITRAL Model Law. The working group’s proposal aims to bring Finland in line with these standards and strengthen the country’s position as a Nordic seat. From a Nordic market perspective, this proposal is a strategic step. Sweden’s Stockholm Chamber of Commerce (SCC) remains a premier venue, while Denmark and Norway already legislate on a Model Law basis. Aligning Finland’s statute with international norms could remove perceived disadvantages, particularly in ad hoc cases where statutory provisions matter most.
What would change? Some key elements of the proposal
Form of the arbitration agreement
The proposal removes the statutory requirement for a written form. Any clear agreement to arbitrate would suffice, mirroring the 2006 Model Law approach and modern contracting realities (including electronic contracting). This change reduces formalistic challenges to arbitration clauses, particularly in digital business environments where agreements are documented through email chains, platform terms or electronic signatures. For international parties accustomed to flexible form requirements, this enhances predictability and reduces the risk of unenforceability based on technicalities.
Arbitrability test
The current, often criticised “private law nature” criterion would be replaced by a simpler and internationally familiar question: can the dispute be settled by agreement? This reduces uncertainty in matters involving public entities or corporatised functions. By shifting to a settlement‑based test, the proposal aligns with the New York Convention’s approach and removes the ambiguity around whether disputes involving regulatory elements or public‑sector actors can be arbitrated.
Kompetenz-kompetenz and separability
Although well recognised in Finnish practice and institutional rules, these principles would be codified to ensure clarity in ad hoc cases. The report addresses this by introducing clear provisions that empower tribunals to rule on their jurisdiction, including challenges to the existence or validity of the arbitration agreement and questions about its scope. The draft also codifies the principle of separability, ensuring that an arbitration clause is treated as independent from the main contract. The new Act would allow a party to seek judicial review of a positive jurisdictional decision within a defined time frame of 30 days from the tribunal’s ruling without suspending the arbitration proceedings.
Interim measures by tribunals
Today, enforceable interim relief largely requires court involvement since tribunal ordered measures lack statutory enforceability. The draft gives tribunals explicit power to order interim measures, with court confirmation for enforcement. This would align Finland with other advanced seats where tribunals can issue urgent measures (such as asset freezes and preliminary injunctions) that can be enforced swiftly. It reduces the need for parallel court applications and makes arbitration more effective in fast‑moving commercial situations.
Digitalisation
The proposal embeds electronic communications, remote hearings and electronic awards in statute, aligning the law with current practice under institutional rules and parties’ expectations for efficient, technology-enabled proceedings. By expressly permitting remote hearings and e‑awards, the Act would ensure that procedural efficiency is available equally in both institutional and ad hoc cases. This is especially important for multinational disputes where cost and travel considerations influence seat selection.
Challenges and annulment
The proposal harmonises the grounds for setting aside an award with Article 34 of the Model Law and Article V of the New York Convention, thereby replacing the current open‑ended nullity possibility. A strict time limit of 60 days for annulment actions is introduced, which eliminates a source of uncertainty that has historically undermined its attractiveness as an arbitration venue.
Court architecture
One of the practical challenges under the current Finnish Arbitration Act is the fragmented handling of court proceedings related to arbitration. According to the proposal, arbitration related court matters would be centralised in two specialised courts (the Helsinki Court of Appeal and the District Court of Länsi-Uusimaa), promoting consistency and speed. Concentrating arbitration‑related matters in specialised courts ensures that judges familiar with arbitration practice oversee complex procedural and jurisdictional questions. This reduces regional disparities and aligns Finland with international expectations for efficient, expert judicial support of arbitration.
Legislative pathway and indicative timing
The working group report entered public consultation in late 2025/early 2026. The Ministry has indicated preparation of a government bill in 2026, followed by parliamentary review. Given scheduling realities and election cycle pressures, adoption in late 2026 or early 2027 is plausible, with entry into force expected sometime during 2027.
For more information, please contact: Jan Waselius, Bernt Juthström, Christoffer Waselius and Antonina Paasikivi.