Litigation 2026

Litigation in 2026

The global economy is facing substantial headwinds in 2026 that are likely to generate a new wave of trade-related litigation. Increased trade tension, escalating trade barriers and supply chain disruptions caused by a tariff war have combined with inflationary pressures and high national debt levels to create an unstable environment: the World Bank estimates that global GDP growth in 2025 will be just 2.3%, the slowest growth rate since 2008. This has led to macro-economic uncertainty and, for many corporations, an increased appetite for litigation. The sectors that are seeing the most disputes are the construction, mining, transport and energy sectors, which are all heavily affected by trade fragmentation and supply chain disruptions.

Against this economic backdrop, the global litigation landscape continues to be dominated by significant geopolitical and regulatory risk: sanctions against Russia, Belarus and Iran have impacted commercial activity across the globe, while energy and climate change-related regulation and conflicts in Ukraine and the Middle East continue to be politically polarising issues.

Europe

London remains a popular choice for dispute resolution. It is the world’s leading centre for international dispute resolution by litigation and, equally with Singapore, by arbitration, according to the Queen Mary University of London International Arbitration Survey.

In Europe, one major change is the facilitation of collective or class actions. Under the Representative Actions Directive, all EU member states are now required to have at least one procedural mechanism in place for consumers to seek collective redress. Recent data shows a continuous and dramatic rise in class actions being filed in Europe in recent years, with 97 class actions filed in 2024 for a value well in excess of EUR380 billion, an 800% increase in value since 2020.

The UK has experienced a similar relentless growth in class actions. According to one recent survey, up to the end of 2024, competition class actions involving over 655 million class members were filed in the UK, with claimed quantum now exceeding GBP155 billion. One of the largest sets of proceedings before the English courts is the Pan-Nox Emissions Group Litigation (also known as “Dieselgate”) involving claims against in excess of 2,000 retailers and finance companies, as well as against different vehicle manufacturers.

In Europe, a number of EU member states continue to seek to attract litigation cases that traditionally go to the English courts. France and the Netherlands have created their own specialist commercial courts where judges have experience in private international law to cater to international disputes. Germany has established English-speaking commercial courts, and Switzerland is taking similar steps. Starting from 1 January 2025, cantons in Switzerland have been permitted to establish international commercial courts where proceedings can be conducted in English.

Despite these new arrivals, the impact on the English courts that some considered would result from Brexit has not materialised: UK exports of legal services continue to grow exponentially, second in size only to the United States.

Middle East and Asia

The establishment of international-facing courts in Europe follows an earlier trend in the Middle East and Asia.

In the UAE in particular, the courts of the financial free zones of the Dubai International Financial Centre and Abu Dhabi Global Market, and the Qatar International Court, are starting to rival London as the commercial courts of choice for many international litigants. Elsewhere in Asia, the Singapore International Commercial Court, the Astana International Financial Centre Court and the China International Commercial Court all specialise in the resolution of cross-border commercial disputes and, for the most part, use English as the language of proceedings. Cases in these courts are often decided by senior judges and lawyers drawn from multiple jurisdictions (except in the China International Commercial Court, where the judges are exclusively Chinese).

The establishment of international courts in the Middle East and Asia certainly reflects the eastward shift in economic growth and opportunity. However, all these courts are ultimately modelled on the Commercial Court of England and Wales, which remains a highly attractive jurisdiction for international dispute resolution.

USA

In the USA, the Trump administration has implemented a series of unilateralist and protectionist trade policies that were dramatically announced on so-called Liberation Day. As of November 2025, Census Bureau trade data shows that just under 50% of all goods that enter the USA are now subject to tariffs. The legality of many of Trump’s new tariffs are being challenged in the US Supreme Court, creating further uncertainty as to future trade conditions.

More broadly, the USA has become increasingly hostile towards international trade treaties that commit the USA to resolving disputes by arbitration or other means of international dispute resolution. The USA has withdrawn from the Trans-Pacific Partnership (TPP) and has ruled out joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). It has also renegotiated trade agreements with Mexico and Canada (NAFTA) and South Korea (Korea-United States Free Trade Agreement; KORUS).

State courts in jurisdictions such as New York and California nevertheless remain attractive choices when international litigants enter into jurisdiction agreements. Where no jurisdiction agreement exists, the US Supreme Court has scaled back US courts’ power to assume jurisdiction over foreign companies in disputes that have arisen outside the USA (Goodyear Dunlop Tires Operations SA v Brown, Daimler AG v Bauman, BNSF Railway Co v Tyrrell and Bristol-Myers Squibb v Superior Court of California). This change is welcomed by foreign litigants who are anxious about the US courts exercising jurisdiction over disputes that have no connection to the USA.

In 2025, the US Supreme Court has continued its long tradition of supporting international arbitration. In CC/Devas (Mauritius) Ltd. v Antrix Corp. Ltd, the US Supreme Court issued a significant decision with respect to the federal court’s jurisdiction over the enforcement of foreign arbitration awards against a sovereign under the Foreign Sovereign Immunities Act (FSIA). The Supreme Court held that, under the FSIA, personal jurisdiction exists over a sovereign entity when “an immunity exception applies and service is proper”. In reaching this conclusion, the Supreme Court held that the FSIA does not require a showing of “minimum contacts” with the jurisdiction in which enforcement is being sought to establish personal jurisdiction. The decision reflects the US courts’ long-standing pro-arbitration stance and a reluctance to impose restrictions on enforcement actions.

In Yegiazaryan v Smagin, the Supreme Court ruled that the Racketeer Influenced and Corrupt Organizations Act (RICO; the US racketeering law) is available as a mechanism to enforce foreign arbitral awards in the USA. This adds a potentially powerful tool for the enforcement of arbitral awards in the United States: it gives judgment creditors another avenue to enforce against third parties involved in racketeering, and leaves open the possibility of obtaining treble damages and recovering legal costs.

International arbitration

Despite attempts by newly formed courts to attract international business, arbitration remains the preferred form of dispute resolution for businesses operating across borders. In the recent Queen Mary University of London International Arbitration Survey, 90% of respondents chose international arbitration – on its own or with other forms of ADR – as their preferred means of dispute resolution in international contracts.

The cornerstone of international arbitration’s success is the New York Convention, ratified by 172 states, which celebrated its 67th anniversary in 2025. The Convention protects the enforcement of arbitration agreements and awards, ensuring – with rare exceptions – that arbitral awards can be enforced against award debtors. In its global reach and success, the New York Convention remains unparalleled in other forms of international dispute resolution.

Use of artificial intelligence

Investment in technology and AI continues to boom as companies have invested heavily, especially in the use of generative AI. This is having obvious and profound effects on the litigation landscape. For legal practitioners navigating complex document-heavy disclosure processes, AI and, in particular, generative AI (GenAI), offers a potentially transformative and cost-effective solution. There is now a growing consensus among legal practitioners that they are likely to use AI and GenAI for other purposes, including assisting with drafting and predictive case analytics.

The increased use of AI in litigation is, in turn, generating its own litigation. In a recent case in the English Court, Al-Haroun v Qatar National Bank[2025] EWHC 1383, the Court found that a witness statement was submitted that had been prepared using GenAI and cited non-existent case law and authorities. The Court gave a clear message: AI-generated content cannot be accepted at face value, and lawyers using an AI assistant for research should independently verify the AI’s findings.

Looking ahead to new challenges

Two key new global challenges that pose significant litigation risk are the regulation of crypto-assets and environmental regulation. These are politically polarising issues, as the US presidential election highlighted. Along with a rapidly evolving regulatory landscape, an increasing number of disputes relating to crypto-assets and blockchain technologies are giving rise to complex legal challenges posed by the novel nature of the assets themselves. Climate change-related litigation also poses novel legal issues, including concerning questions of justiciability and the role of human rights law and remedies in climate change litigation. A continued, exponential rise in litigation in both of these areas is expected.

Cybersecurity and data disputes also continue to increase, as cyber-attacks pose an increasing threat to businesses across the globe that hold sensitive commercial information. The shift to digital working and rapid advances in the use of AI have further increased this threat. According to a recent report published by QBE, the number of cyber-attacks taking place each year has more than doubled since 2020. This has generated a wave of cybersecurity-related litigation, which is expected to continue into 2026.