In July 2021, the Ministry of Justice (MoJ) released its proposed revisions to the Arbitration Law (AL) for public consultation, sparking hope for the liberalization of ad hoc arbitration in China. However, the planned reform is unlikely to be comprehensive, as it is limited to foreign-related commercial disputes and burdened with procedural requirements. This study finds that the favourable treatment of foreign-related sectors and the insufficient quality of domestic arbitration contribute to China’s pattern of ‘half-measure’ ad hoc arbitration reforms. Since it will take a long time to reduce the disparity between the legal performance of foreignrelated and purely domestic sectors, China has adopted ‘gradualism’ in its legal reform. In doing so it seeks to minimize instability during its transition and maintain the reliability of arbitration. To achieve these goals, this article suggests that further reform of China’s ad hoc arbitration proceed on its dual track, temporarily shutting out domestic sectors while further internationalizing foreign- related ones.