Bill > SB227

This bill, effective July 1, 2026, introduces new regulations for "high-volume arbitration service providers," defined as entities administering over 100 arbitrations annually that stem from pre-dispute arbitration agreements involving a "Virginia-connected transaction" (meaning a dispute related to activities within Virginia). These providers must establish fair procedures for selecting arbitrators, ensuring parties have an equal voice and preventing unilateral imposition of an arbitrator, with acceptable methods including striking, ranking, or random selection from an approved pool. Arbitrators must also disclose potential conflicts of interest, similar to judicial conduct rules, and providers cannot have financial ties to parties or their law firms. High-volume providers must report annually to the State Corporation Commission about their arbitration numbers, selection procedures, and statistical data, and face a $10,000 civil penalty per violation for non-compliance. Parties aggrieved by a provider's failure to follow these rules can seek court orders to stop the violation or vacate an arbitration award if the arbitrator was selected improperly, and the bill also clarifies that a drafting party's failure to pay arbitration fees can lead to default and waiver of their right to compel arbitration, allowing the consumer or employee to proceed in court or compel arbitration with the drafting party covering attorney fees.