Commercial litigation trends in London: the disputes your business should be aware of

The next commercial dispute your business faces may start with an AI tool, a professional mistake or a regulator’s finding.

The economic pressures of the past two years are increasingly showing up in London’s disputes market. Customers are paying late or defaulting, suppliers are passing on cost increases mid-contract and lenders are tightening their terms. In that environment, commercial relationships that once absorbed friction through goodwill or renegotiation are beginning to break down. Businesses that might previously have written off a disputed invoice or accepted a delayed delivery are instead pursuing formal claims.

As a result, disputes are emerging from new areas of risk as well as more traditional sources. Against that backdrop, three trends are shaping London’s commercial disputes market in 2026.

1. AI disputes are moving into the boardroom

As businesses integrate AI and other advanced technologies into their operations, disputes arising from their use are becoming more common.

A system may not perform as promised, AI-generated material may trigger an intellectual property claim or a regulator may question how the technology was used. The UK’s principles-based approach to AI regulation is still developing, creating uncertainty that can give rise to litigation.

Companies deploying or procuring AI solutions should pay close attention to the contractual allocation of risk, liability for decision-making and compliance with emerging standards.

2. Professional negligence claims are increasing

In a tighter commercial environment, businesses are scrutinising the advice and services they have received more closely.

Professional negligence claims against advisers, consultants and service providers are a growing feature of the London disputes market. A transaction or project loss can quickly lead to a blunt question: “was this simply a bad outcome, or did someone get the work wrong?”

Businesses providing advice should ensure their terms clearly set out what they’re responsible for, what they’re not responsible for and any agreed limits on claims.

3. Regulatory investigations can trigger civil claims

London businesses should also be prepared for the interplay between regulatory enforcement and civil claims.

Regulatory investigations are creating knock-on commercial disputes, as findings by regulators can be relied on in civil claims brought by customers, investors, business partners or others affected by the conduct. Recent reforms and proposals, including the Economic Crime and Corporate Transparency Act 2023, point to continued scrutiny of corporate controls and governance.

Businesses facing regulatory action should anticipate the possibility of follow-on civil claims and manage disclosure and communications accordingly from the outset.

Managing litigation risk: practical steps

You can’t predict every dispute, but you can prepare for the pressure points most likely to affect your business:

• Audit key contracts: check clauses dealing with events outside your control, material adverse change, price adjustment and termination against the current market. Make sure contracts clearly set out who bears risk if something goes wrong and whether limits on claims work as intended
• Preserve evidence early: if a dispute looks likely, implement document preservation measures promptly. The courts take disclosure obligations seriously, and early steps to secure relevant documents and communications will strengthen your position
• Consider alternative dispute resolution: arbitration and mediation remain important tools for resolving disputes efficiently and confidentially. Mediation in particular can offer a cost-effective route to resolution before positions become entrenched
• Engage advisers early: as with any period of elevated risk, businesses that seek legal advice at the earliest opportunity, whether to assess a potential claim, respond to a regulatory enquiry or restructure a commercial relationship, will be best placed to manage costs and outcomes.

What this means for London businesses

The prevailing view is that 2026 represents a period of adjustment rather than crisis. London remains a trusted forum for resolving commercial disputes, but the businesses best placed to avoid costly surprises will be those that act before a problem becomes a claim.

Proactive contract management, early engagement with advisers and a clear-eyed assessment of risk exposure will be hallmarks of well-prepared London businesses this year.