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ARTICLE · 23 DECEMBER 2025

UK Government Intends Third-Party Funding Regulatory Streamlining

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The UK Ministry of Justice has announced an intention to remove English third-party litigation funding from the current requirements of the Damages-Based Agreements Regulations 2013 ("DBA Regulations") and provide for a different regulatory framework.

United KingdomLitigation, Mediation & Arbitration

The UK Ministry of Justice has announced an intention to remove English third-party litigation funding from the current requirements of the Damages-Based Agreements Regulations 2013 ("DBA Regulations") and provide for a different regulatory framework. As we have discussed previously here and here, various forms of uncertainty remain for third parties who wish to fund UK litigation or arbitration while taking a cut of damages awarded, although funders' return based on multiples of funding has been approved.

The present regime of the DBA Regulations restricts the amount of damages a third party funder may share in, as well as providing certain requirements for how the agreement may be formed.The previous Government set out a basic bill to simply remove third-party litigation funding from the DBA Regulations, but the bill fell after the last election. The Civil Justice Council ("CJC") subsequently issued a wide-ranging report recommending that removal, and light touch

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