why lawyers should care about robotics - amazon s3 · volume 1, no. 1 july 2015 why lawyers should...

Analysis and insight for the industry – lawyers, regulators, manufacturers and users

Volume 1, No. 1 July 2015

Why lawyers should care about roboticsby Neas a Mac E r lea n

Now is the time for lawyers to become involved in the robotics sector. In aviation law, a small number of people – including a founder of Rolls-Royce and a ballooning organisation called the Royal Aero Club – had a disproportionate effect on the creation of international aviation agreements a century back. A similar phenomenon could happen now.

One of the main aims of Robotics Law Journal is to help regulators, governments, lawyers and judges to develop a new legal and regulatory framework which will enable us to unleash the commercial opportunities of robotics and AI while keeping us safe, preserving our privacy and improving our employment prospects. Drones and driverless cars – entering air and road space on a commercial basis this year – are the harbingers; and they require the design and implementation of a wide range of new rules throughout the 200 countries of the world.

Challenges to the legal systemDrones “challenge the very principle of a legal system,” writes one of the first contributors to Robotics Law Journal. Peter Birkett, a property specialist at Howard Kennedy in the UK, is looking at the issue of trespass by a drone – something that both Barack Obama and Shinzo Abe were victim to in early 2015 when one of these vehicles crashed on

the White House lawn and another landed on the roof of the Japanese prime minister’s office.

Beyond the scope of legal remediesSearching for effective remedies to drone trespass, Peter Birkett concludes: “Technology is taking us beyond the scope of legal remedies and into realms where identification of the wrongdoer is difficult, the time required to obtain a remedy can never match the speed at which trespass can benefit the perpetrator and the calculation of damages may be influenced by the interaction with the rights of large groups of owners who have no practical means of securing collective action.” (The article is to be published in the August update.)

Drones – following mobile phones Most lawyers can expect their law firms to have to deal with the implications of drone law in

some form of another within the next few years. For a start, drone use will be very widespread. “I personally believe that it will be like the mobile phone market,” says another of our contributors, Joe Urli from Australia. “This is a huge, huge industry that is waiting to realise itself.” Regarding robots, there are over 1m involved in industry now, according to the Japanese Robot Association which predicts a robot sector worth £1.5 trillion within the next five years. But drones and other forms of robotics will require new rules and approaches in many different areas of the law – including employment, patents, privacy, road and air traffic, property, insurance, litigation, personal injury, licensing and business start-up. We examine many of these subjects in this first issue.

Which industry sectors will

robotics touch? Writing of the drones sector, contributor Peter Lee of Taylor Vinters lists these as current areas of activity: ‘journalism (dubbed ‘dronalism’), facilitating internet and telecommunication platforms in inaccessible or hostile environments, fire and rescue, policing, marketing, precision farming, crop dusting, fire detection, flood monitoring, inspection of oil and gas rigs, pipeline security surveillance and geo-physical surveys’. Looking at particular jurisdictions, Peter Lee puts Sweden, Japan, France and the UK at the forefront.

Cautious regulators?Some of the issues that relate to drones could look simple, however, in comparison with those that will emerge – as AI becomes far more widely used through the ‘internet of things’, domestic robots and virtual reality. How will we apportion liability, for instance, when losses or damage occurs while robots are making the decisions? “I would not be surprised if regulators become too cautious,” warns Luis France of Perez-Llorca in an article on AI. “After all, there will always be those that distrust new technologies and will therefore try to limit their use (consider for example the reactionaries of the 19th century after the industrial revolution).”

GLOBAL: PETER LEE: ‘The best companies in the world

are truly global and will move to jurisdictions with permissive regulations that allow them to prove concepts and deploy the

technology.’ Page 4

DRIVERLESS CARS: CLAIRE TEMPLE:

‘An area of increased complexity for insurance companies to deal with will be working out who is

liable in driverless situations.’ 5

ROBOTS WITH PERSONALITY:

‘Personality robot development is going to be a huge area of business,

for customer interfaces such as airlines, hotels, and for robot

receptionists.’ Page 12

SENTIENT ROBOTS: LUIS FRANCO: ‘I believe that the role of lawyers and

regulators in the event of sentient machines being developed should involve considering the legal status of such machines, in order to promote integration and cooperation instead

of conflict.’ Page 9

Continued on page 2

ContentsAustralia & privacy 2, South Africa 3, Manufacturing 3, US law firms 3, AI 4, Robots 5, World overview 6, US 7, UK 8,

Australia 9 , New Zealand CAA & privacy 10, Employment 11, US state and federal laws 12, Driverless cars 14, Insurance 15

2 www.roboticslawjournal.com

Lawyers will play a crucial role in the development of these markets – not just in advising clients but also in shaping the regulation itself. As we know from the worlds of tax and banking, the world is a global marketplace where regulators compete to make their own jurisdictions more attractive to international businesses. The same is happening here. Amazon, for instance, has been delayed in trailing its drone delivery vehicles by the slow development of US regulations. But, in Canada and Mexico it can find a far

warmer welcome for its pilot runs. In all territories, lawyers will be among the best-informed people to comment on how regulation should develop.

Influence through codes of practiceRegulation can also take many different forms. Lawyers which inform themselves now will be well-placed to help industries set up their own codes of practices – moves which put industry players in a much more powerful place when negotiating with governments and regulators.

The end of the human race?Some lawyers will become

involved in trying to stop the mis-use of this new technology – such as the use of robotics (particularly drones) by terrorists, the unexpected ‘flash crash’ vulnerabilities caused by ultra-fast share trading and the potential for accidents caused by irresponsible drone-owners. There is also, long-term, that dire warning from Professor Stephen Hawking to consider – that “The development of full artificial intelligence could spell the end of the human race”.

Robotics is surprisingly similar to the discipline of law in certain respects. The cybernetics aspect of robotics – the part that lifts it

above electronics – is the study of communication, rule-giving and feedback, an area that is not a million miles away from the law. And the electronics aspects can be very simple: even the robotic arm (Canadarm2) on the International Space Station is far less complicated than a layman might expect. Since half of the growth of robotics is expected to take place in the services sector – through personal robots, for example – over the next 20 years, it seems that robots are entering everyday life. Neasa MacErlean, formerly a journalist on The Observer and the City Editor of The Lawyer, is the editor of Robotics Law Journal

Drone News: New Zealand and Australia

New Zealand RPA rules pave way for BVLOSNew Zealand is taking a different approach to many other CAAs (civil aviation authorities) by making no distinction between commercial and private users – and by preparing for BVLOS.

The new regulations take effect on 1 August. They reflect the outcome of a consultation and a shift away from plans to

distinguish between commercial and private use. In an interview with Robotics Law Journal, the CAA says: ‘New Zealand’s Civil Aviation Authority is committed to developing risk-based regulation, to ensure that any rules we develop address the safety risks of a particular activity, rather than considering

the purpose of the activity, which may have little bearing on its risk profile.’

Explaining the rules themselves, the CAA said in an announcement: ‘The focus was shifted from the intent of the flight (ie, whether or not it was for payment) to the nature of the activity itself (ie, in what airspace; carrying hazardous

materials; proximity to people or property, etc).’

The New Zealand approach is expected to make it easier for users who want to fly drones beyond visual line of sight (BVLOS) but – as explained in the interview – BVLOS is expected to take place in segregated airspace at first.

Australia urged to revamp surveillance rules on back of drone concernsAs Australia’s privacy commissioner and others lament the lack of effective rules, some Australians are asking for a quantum leap to put ‘Australian surveillance law a step ahead of the technology horizon’.

Privacy commissioner Timothy Pilgrim has said: ‘The Privacy Act does not cover the actions of individuals in their private capacity, including any use of drones by individuals. I have expressed my concern about whether current laws, both State and Federal, provide sufficient regulatory protection, including appropriate restrictions on unreasonable uses.’

Following his comments, a report has been published – ‘The Use of Drones in Australia – An Agenda for Reform’ – by Liberty Victoria (a group campaigning for human rights) and the Australian Association for Unmanned Systems (AAUS). Stating that the ‘Australian privacy law regulating the use of drones and surveillance is not fit for purpose’, the authors say that their proposals would ‘encourage the development of Australia’s unmanned systems industry and ensure that valuable commercial and social use of unmanned systems can be undertaken without fear of breaking the law’.

Lack of certainty over the rules is holding back the development of technology, claims the report. This means that surveillance, where needed, does not work as efficiently as it could. It also means that commercial opportunities are being missed. Drones used for surveillance range between insect-size technology to systems which look like commercial aircraft. Drones have also been flown for as long as 48 hours in the US. The smaller systems could be of particular use to the private investigations sector.

The proposal suggests the ‘extension, consolidation and harmonisation of Australia’s

existing state and territory based surveillance devices laws’ alongside two general prohibitions on:l the installation or use of surveillance devices; andl the communication or publication of private records obtained through the prohibited installationl or use of surveillance devices.

There would be many exceptions to the two general prohibitions – with the aim of protecting legitimate and beneficial surveillance. The report was published with the help of the King & Wood Mallesons Human Rights Law Group.

1 AUGUST SEPTEMBER OCTOBER OCTOBER BY END 2105 2016 2015 2015 -18 2016 FEBRUARY 2017

New Zealand Arizona, US EU Nevada, US USA Canada Australia USA Europe USA Updated UAO rules

Paradise Valley to decide on possible drone ban

EP Parliament discussion on safe use of drones

Regs on drones FAA regs Lighter regs for small drones

Lighter regs for commercial drones under 2kg

FAA RPAS framework

Closure of experimental site program

Significant small town battle on conflicting human rights on drones

Based on report by MEP Jacqueline Foster

Governs use by police and public

Drone flying permitted

For drones under 25kg

From Civil Aviation Safety Authority

Approve Ground Based Sense & Avoid systems

To implement March 2015 Riga accord

Relates to 6 sites now in use

Global timeline: what to expect on drone regulation

Continued from page 1

www.roboticslawjournal.com 3

One in five of the world’s UAV 425 manufacturers is located in the US – a clear sign of the frustrated demand building up in the sector.

Boeing, Honeywell, Lockhead Martin, NASA and Northrop Grumman are among the 86 USA-based organisations listed by UAV Global as serving the commercial and military markets.

Not surprisingly, the UK comes second – with a list of 29 manufacturers (including BAE Systems and Cobham). More surprising is that Russia (24) comes equal third. Some 15 (nearly two-thirds) of the organisations listed are based in Moscow. Russia ties with France and China. Beijing is a major centre (8). Manufacturers include the Chinese Academy of Surveying & Mapping and the People’s Liberation Army Air Force.

The next countries are Israel and Germany (13 each); Brazil (12); Canada, Australia and Japan

(11 each); Italy (10); and India, Norway, Poland and Spain (nine each).

One apparently surprising element of the listing is the common mismatch between the readiness of regulation and the number of manufacturers. UK-based lawyer Peter Lee says that the leading countries in regulation are France, Japan, UK and Sweden. Meanwhile Joe Urli of the Australian Certified UAV Operators Association says that New Zealand is particularly advanced. However, Sweden and New Zealand have just four manufacturers each. Joe Urli gives an explanation as to why this might be: ‘Every country has a different level of maturity. Smaller countries with more mature regulation are probably better positioned to introduce drone corridors and drone delivery systems. It’s probably easier for second world countries. In first world countries there are lots of issues around.’

Drone News: USA and South Africa

Prison sentences of up to 10 years to come in for RPA violations in S AfricaSouth Africa’s drone rules – which took effect on 1 July – contain some surprises, including regulations for BVLOS flying and jail sanctions for private and commercial pilots.

The rules are being incorporated into the existing Civil Aviation Act – as a way of getting them in to place fast. Introducing them, The South Africa Civil Aviation Authority (CAA) said: ‘The SACAA acknowledges the urgent need and demand for RPAS usage and has allocated the necessary resources to ensure that the need is met

within the shortest time possible.’Any operation carried out before

1 July would have been illegal. The director of the organisation, Poppy Khoza, called the development ‘a momentous occasion in the local aviation industry; and to some extent the world’.

The rules contain a range of prohibitions – for instance, no flying near or next to nuclear plants, courts and police stations; and no flying within 50m laterally of other people. Flying Beyond Visual Line of Sight (BVLOS) is envisaged – and a special rule here requires a special (class

four) medical certificate for such flying. An alternative is offered for BVLOS – a restricted certificate of proficiency in aeronautical radiotelephony and a particular standard (proficiency level four) in the English language.

Allowing BVLOS is a major step for any country – as the safety implications are far more complicated when the pilot can no longer see the drone.

Speaking of the rush involved in introducing the rules, CAA Director Poppy Khoza said: ‘Under normal circumstances ICAO [the International Civil Aviation

Organisation] would take the lead in terms of developing Standards and Recommended Practices; and Regulators would then transliterate the prescribed Standards and Recommended Practices into legally-enforceable local civil aviation regulations. In the absence of guiding documents from ICAO, Regulators such as ourselves have had to swiftly derive measures to address the regulation deficiency in response to a growing demand to regulate this sector.’

The regulations were signed by Dipuo Peters, Minister of Transport, in May.

Argentina 4Australia 11Austria 4Azerbaijan 1 Belarus 3Belgium 2Brazil 12Bulgaria 2Canada 11Chile 2China 24Colombia 1

Croatia 1Czech Republic 3Denmark 3Egypt 1Estonia 1Finland 4France 24Germany 13Greece 2 Hong Kong v1Hungary 2India 9

Indonesia 2Iran 4Israel 13Italy 10 Japan 11Latvia 1Malaysia 5Mexico 2 Netherlands 4New Zealand 4Norway 9 Pakistan 6

Philippines 2 Poland 9Portugal 6Romania 3 Russia 24Saudi Arabia 2Serbia 1Singapore 3Slovenia 1South Africa 3South Korea 7 Spain 9

Sweden 4Switzerland 7Taiwan 3 Thailand 1 Tunisia 1Turkey 5UAE 2UK 29Ukraine 2USA 86Vietnam 1

US leads world on pent-up UAV demand

Manufacturer numbers – by country

At least 17 US law firms have set up specialist drone law teams – many including lawyers who also have pilot licences.

There is some scepticism about the size of teams – and their experiences with clients. For instance, Michael Drobac, senior policy adviser at Akin Gump, said: ‘Almost every firm has a drone practice. I’m not sure every firm has a drone client.’

Lewis Roca Rothgerber says it has 14 people in its team. Antonelli Law says it has eight, including Kate Fletcher, an ‘active commercial pilot with American Airlines’. Tim Edelman, a certified flight instructor, believes that LeClairRyan in Annapolis, Maryland, became the first law firm with a specialist team when he launched it for them in February 2014.

Law firms with teams are: Akin Gump Strauss Hauer & Feld, Antonelli Law, Cooley, Diaz, Reus & Targ, Hogan Lovells, Holland & Knight, Hunton & Williams, Jones Day, Kramer Levin Naftalis

& Frankel, LeClairRyan, Lewis Roca Rothgerber, McKenna Long & Aldridge (now in the process of merging with Dentons), Morrison & Foerster, Pillsbury Winthrop Shaw Pittman, Reed Smith and Wiley Rein.

Speaking of the range of issues, Kenneth Quinn, head of the Pillsbury drone focus team, said: ‘Our clients now range across dozens of industries, with both civilian and governmental applications, and they face significant challenges not only from a regulatory, insurance, and liability perspective, but also are dealing with enforcement, safety, security, privacy, financing, contractual, and intellectual property issues.’

Regarding the readiness of US rules in the area, Brant Hadaway, of Diaz, Reus & Targsays believes that some communications from the Federal Aviation Authority have been over-interpreted and says : ‘we are, unfortunately, probably still years away from autonomous drone deliveries.’

US law firms reach ‘dozens of industries’ through drone teams


AI: A new area of law 10% of flights expected to be unmanned by 2025 (Source: EU Commission)

Artificial intelligenceHow will the law begin to develop to provide a framework for this fast-developing area? Luis Franco of Perez-Llorca gives some answers.

Do you think the apparently imminent arrival of driverless cars will hasten the development of the necessary regulatory, legal and insurance framework?

Without a doubt. In fact, several countries have already started to take on the topic of autonomous vehicles: in Europe, Germany and the UK are working towards legislation for driverless cars and in the US, several states (Nevada, Florida, California, and Michigan) have already passed laws to allow the use of driverless cars.

It is important to consider that, up until now, automated machines have only been present in a limited number of scenarios, in which the environment has been controllable and access has been relatively restricted (for example in scientific labs and factories). However, in the case of driverless cars, the legislator will be faced with an automated machine present in the public domain. Moreover, far from simply performing a given set of specific and predesigned tasks (like, for example, an assembly robot in a car factory), driverless cars will be evaluating and reacting with their environment and, in a way, acting upon their own decisions.

Furthermore, road transport, in all of its manifestations (freighters, public transport, private cars, etc.), is affected by a wide range of laws and regulations, which will all have to be reviewed and amended, such as, for example, driving licenses, vehicle registration certificates, traffic regulation, insurance policies and liability in the event of damages or injury.

In short, I believe that driverless cars present a superb opportunity and a test ground for developing the necessary regulation for AI.

How do you expect regulation to develop as we move to greater reliance on robots and AI?

As already mentioned, I believe that road and air traffic regulations will likely be among the first regulations to be amended to take into account driverless cars and drones, given their imminent arrival. In addition to legalising the use of such vehicles, legislators will be handed the task of considering the implications of accident liability and, in accordance with these new terms, insurance regulations will also have to be adapted.

With regard to insurance regulations (already under review in the UK in order to take into account driverless cars), I believe that the most significant matter in hand will be determining who exactly should bear the cost of covering damages caused by autonomous vehicles when no malfunctioning was involved; that is to say, when damage occurs as a result of current technological advances not being able to predict or avoid the damage. In these cases, I believe that a reasonable solution would be for the manufacturer and owner to share the cost of insuring that risk ‒ although perhaps not in equal proportion, given that they are both assuming said risk and profiting from the vehicle. Another possibility would be to regulate this risk in the same way in which natural disasters are insured (given that there would be no one to blame for causing the damage), either through reinsurance policies or through publicly funded coverage.

Personal data protection regulations will most likely need to be reviewed in the short term, considering the increasing capabilities of technological systems in automatically managing and learning from information, as well as the ever expanding amount of information available on the Internet. In relation to these points, there are a number of closely related issues that I believe that regulators should take into careful consideration, along with the questions that they pose, namely

the sharing of information between systems (Is this possible? Under what circumstances and or conditions may the information be shared? To what end may that shared information be used?) and the access to information by the system itself (How can systems access information? Which kind of information can they manage?).

Is there a danger that regulators will become too cautious?

I would not be surprised if regulators become too cautious. After all, there will always be those that distrust new technologies and will therefore try to limit their use (consider for example the reactionaries of the 19th century after the industrial revolution).

I personally believe that AI has the potential to bring about great advances in science and, therefore, be instrumental in moving humankind forward. For this reason, it is important that we facilitate the development of AI with open minded regulations. However, as several renowned scientists have pointed out, AI also brings with it certain risks. Therefore, I believe that regulators should promote steady, but careful, development of AI, especially in certain areas.

One such area is the establishment of safety standards for driverless cars, to ensure that the vehicles have been thoroughly tested before these vehicles are allowed to drive on public roads.

Another field in which legislators should be extremely careful is within the arms industry. A number of associations and individuals currently demand a complete ban on the development of fully automated weapons (for example, the International Committee for Robot Arms Control, Human Rights Watch and Harvard Law School’s International Human Rights Clinic). I do not believe that we should completely dismiss the notion, given that AI weapons may be able to significantly reduce the number of collateral and civil casualties that we


AI: A new area of law

see in armed conflicts today. However, I believe that weaponry is most definitively not the best testing ground for AI. Actually, it is quite the opposite, considering the dire consequences of any mistake made in this. Therefore, I believe that the development of autonomous weapons should be left until AI is sufficiently mature and reliable enough to avoid accidents.

Do you share the concerns that Professor Stephen Hawking (“The development of full artificial intelligence could spell the end of the human race”) and IT entrepreneur Elon Musk have expressed over AI? Why or why not? How can lawyers and regulators play a role in reducing these dangers?

I do not think that we can fully disregard these prospects, but my approach is quite different to that of Professor Hawking and Elon Musk; I believe that such a risk is highly remote.

Both Stephen Hawking and Elon Musk have addressed the matter from the perspective of Darwin’s theory of evolution (i.e. the survival of the fittest). Indeed, during the same interview as that quoted above, Professor Hawking also states that “Humans, who are limited by slow biological evolution, couldn’t compete [with AI], and would be superseded”.

Such an approach from their perspective is logical, as they are both scientists, however, I do not consider this to be the most appropriate way of comprehending this matter. We must be aware that the dangers to which Professor Hawking refers (the extinction of humankind before a more evolved species) can only come to pass in the event that truly sentient machines can be developed.

Whether sentient robots can be developed or not is a highly controversial issue within the scientific community. Mark Bishop, Professor of Cognitive Computing at Goldsmiths, University of London, for instance, is against the idea, as he believes that “there are some key human abilities, such as understanding and consciousness which are fundamentally lacking in so-called “intelligent” computers”. I am certainly not qualified to offer an opinion on this matter from a technical point of view, however I am inclined to think that sentient robots are a possibility.

Consider the human brain: we know how it is built and, more or less, from a biomechanical point of view, how it works (electric impulses pass from neuron to neuron to specific areas in the brain, which control specific functions) but, ultimately, we do not know what makes us sentient (and, therefore, human), nor, concretely, what gives us our own personalities. Taking this into account, it is not inconceivable that someone may be able to create a synthetic brain which may be able to develop sentiency. In fact, recent investigation on AI involves working on artificial neural networks).

However, even if we assume that the creation of sentient machines may be possible, I still believe that the risk of being superseded by them is extremely unlikely. As a matter of fact, I believe that in such an event, Darwin’s theory would become obsolete, and that the matter should be approached from a sociological point of view. Darwin’s theory is primarily applicable to nature, where the fittest survive and the weak do not (even amongst the same species). However, the development of human society has completely changed the rules of evolution, at least amongst humans, and there is no longer the problem of evolution or extinction (even if, of course, there has been and, regrettably, still are, wars and conflicts in human history). Therefore, I believe that if sentient machines were to be created, there would not be a conflict between the evolution of both species.

In view of the above, I believe that the role of lawyers and regulators in the event of sentient machines being developed should involve considering the legal status of such machines, in order to promote integration and cooperation instead of conflict.Luis Franco is a Litigation and Arbitration Lawyer at Pérez-LlorcaIn the pipeline – next issue: l Robots: are the three rules of Asimov a good starting point for a law on robots?l Algorithms: are they dangerous? do they need to be regulated? Responses from mathematicians

Robots: personality

By N ic k G i l l ie s

Google X’s patent for robots with adjustable personalities ‘prevents competition’, says MIT-based robot ethicist Dr Kate Darling. She asks if it is in line with the US Supreme Court’s decision in Alice.

Personality robot development is going to be a huge area of business, for customer interfaces such as airlines, hotels, and for robot receptionists (the first of which was installed in a Tokyo department store this April). And Japan, with an ageing population, has been in the vanguard of creating ‘caring’ robots for healthcare. Darling says: “It’s hard to imagine that anyone in the field of robotics has not envisaged this. Patents are supposed to support innovations not obvious to anyone skilled in the field.”

Patent 8,996,429 granted by the (US) Patent & Trade Marks Office on March 31 this year, is for robots that change personalities based on circumstances and user information. This information can be taken from other devices or the cloud. Examples given are how the user is known to react to bad weather or the time of day. The patent suggests that personalities could be customised or tuned to give certain in-character responses, for example “perplexed (the Woody Allen robot)”.

In the announcement of the patent, Sebastian Thrun, founder of Google X (the laboratory of Google), suggested it might “get to the point where we can outsource our own personal experiences

entirely into a computer, possibly our own personalities.”

God may have something to say about a monopoly on human immortality, and also it is something Google may struggle to reach in the 20-year life of a US patent. The Chair of the American Bar Association’s AI and Robotics Committee, Matt Henshon, of Boston law firm Henshon Klein, counsels calm. “From the inventor’s point of view you try to carve out as much [protection] as you realistically can.” And he points out that, although the patent was first applied for in 2011, the Examiner would have assessed it in the light of Alice. He says that Google will have to reach accommodations with other inventors.

Alice Corps –v- CLS Bank, decided unanimously by the Supreme Court in June 2012, brought US patent law closer to the EU’s practice, which has been much more hostile to business-method and software patent applications. It gave two hurdles for an application to leap: is it about something well-known, and is the kernel of the application something novel? The case itself was about escrow (a familiar thing) by the use of nothing more than a bit of software. At the time practitioners criticised Alice as “Google Friendly”, but it has led to a marked decline in patent troll claims, according to the ABA Journal.Nick Gillies is a legal and business journalist with a special interest in high tech and AI

Will God need a licence from Google?


The worldOn a global basis, the Convention on International Civil Aviation is the main instrument for establishing rules for the aviation industry. Also known as the Chicago Convention – where the document was signed in 1944 – the Convention sets rules for air safety, airspace, aircraft registration and other related issues.

The Convention created the International Civil Aviation Organization as a special agency of the United Nations. And the Organization, based in Montreal, maintains and updates the Convention.

Drones were something of a challenge for the Organization – as they have not been transporting goods or people, and so have

not fallen into the strict remit of the body. However, in March this year, it published its ‘Manual on Remotely Piloted Aircraft Systems’. ‘We’re on the road,’ says Peter van Blyenburgh. ‘It’s moving.’

A second global initiative is JARUS, a body which seeks to ‘recommend a single set of technical, safety and operational requirements for the certification and safe integration of Unmanned Aircraft Systems (UAS) into airspace and at aerodromes’.

JARUS (Joint Authorities for Rulemaking on Unmanned Systems) consists of representatives of national aviation authorities from around the world and has as an aim to save them all from inventing the wheel for themselves. (UVS International hosts the JARUS web site).

World: Overview

UAV laws delay drone boomCamel racing in Qatar, this year’s Tour de France cycling race, the mapping of land by Network Rail in the UK… drones are involved in all of these activities. And they will be involved in millions of others once the regulators of the world catch up with this fast-developing technology.

So what is the potential for the sector? The EU sees it as ‘truly transformational technology’. It could produce a market worth ‘billions of dollars’, according to US law firm Keller and Heckman. Amazon – which had 10m of its customers using its Prime delivery service over last Christmas – is ‘committed to making Prime Air [drone delivery service] available to customers worldwide as soon as we are permitted to do so’. The BBC, the UK’s state broadcaster, has a drone journalism team. Drone manufacturer Parrot says that ‘the commercial use of drones is going to create a futuristic industry that most of us can’t yet imagine.’

The 1m-strong US National Association of Realtors sees ‘the potential of using UAV [Unmanned Aerial Vehicle] technology to collect images for use in real estate’ as ‘a game-changer for the real estate industry’. And the view from inside the regulatory part of the drone industry? ‘It’s going to be gigantic,’ says Peter van Blyenburgh, president of UVS International*.

He adds: ‘It’s going to be multiples of manned aviation.’ And the air transport sector currently accounts for 1% of world revenue – about US$746b – according to the International Air Transport Association. It employs 58m staff to carry 3b passengers in aircraft worth over US$1.3t, according to the Air Transport Action Group.

EuropeA considerable amount of activity has been taking place throughout the European Union (EU). This is partly because so many police forces, environmental protection authorities and other similar bodies have recognised the potential of drones and are starting to use them. The European Aviation Safety Agency (EASA) is handling all certification issues – on behalf of EU countries as well as Norway and Switzerland – for larger drones (over 150kg by MTOM, Maximum Take-Off Mass).

At the moment, smaller drones – which are expected to be the more widely used ones initially – are the remit of national aviation authorities. These national authorities can develop their own regulations or they could wait until JARUS comes out with its rules. In the longer run, EASA will also regulate smaller drones – going right down to those of virtually zero weight and mass.

Europe currently has the advantage on the US in that some European states – such as the Czech Rep., France, Ireland, Italy, The Netherlands, Spain, Sweden and the UK – permit commercial drone usage for ‘Visual Line of Sight’ drones operations. Countries which are well advanced on ‘Beyond Visual Line of Sight’ drones, as well as those within sight, include the Czech Republic, France and Norway.

USAThe US has been criticised for being slow to develop regulation. Commercial use of drones is currently banned, subject to exceptions. Amazon has been a fierce critic, saying in March 2015 that it got permission to test a drone from the body responsible, the FAA (Federal Aviation Administration) only after that particular model was ‘already obsolete’. Paul Misener, Amazon vice president for global public policy, told Senators at the time: ‘We’ve moved on to more advanced designs that we already are testing abroad.’

But it looks as if the FAA will have regulations ready by the end of this year. It received 4,400 comments during a consultation process on its proposals earlier this year. States and cities are also setting up their own rules on drones. An interesting example recently was Ferndale, a suburb of Detroit, which seemed in April to be gearing up to make it a criminal misdemeanour to fly drones. But City Councillors decided not to introduce a ban after hearing from local businesses and hobbyists. By contrast, concern has been mounting about the number of drones flying around San Francisco’s Golden Gate Bridge – identified as a potential target for terrorists. At least one drone has crash-landed on the bridge, according to the local transport authority.


World: Overview US: Overview

Tim Adelman, shareholder in LeClairRyan in Annapolis, Maryland, believes he opened the first drone law department in a US law firm – in March 2014. An instrument-rated certificated flight instructor, he has worked with regulators and manufacturers and operators. He is also an expert in healthcare law.

What are you advising clients who want to use drones now?Right now there are a number of ways to access the airspace in the US while we wait for the FAA [Federal Aviation Authority] to issue final regulations later this year. A number of companies are using Section 333 petitions for exemption, while others are applying for an experimental airworthiness certificate. Which path they choose really depends on the type of client. A large company could go for a Section 333 exemption or the experimental airworthiness certificate. But if you are a smaller company – a sole photographer or a real estate company – there’s probably not a good return on investment in obtaining a Section 333 exemption or experimental airworthiness certificate. Those companies would probably be better suited to wait for the new rules or ‘proceed at your peril’ now.

Were you surprised that Amazon decided to test outside the US?I’m not surprised. The Amazon concept is a very interesting concept. But I don’t see how their product is going to work in our current environment for the next two to three years. Maybe it will in ten to 15 years. There are other countries whose airspace may be less regulated that will permit the testing of their technology. Amazon could use these less restrictive airspaces to develop an operational model and, when it is ready, take it to the FAA [whose regulatory authority covers drones] and show them how it would work.

My understanding of what Amazon wants to do is to have aircraft with relatively short flight duration – less than an hour. That means they would have to have local distribution centres with a dense population to make the necessary volume of deliveries. So they would be flying in populated areas and cities. To fly over a city, you have to address various technical problems. For instance, there has to be ‘sense and avoid’ in order to avoid people and other aircraft. Then there is the frequency interference issue. There are some pretty challenging obstacles.

Most operators are now ‘Line of Sight’. Until we figure out the radar and the ‘Beyond Line of Sight’ issues, the kind of flight that Amazon wants to perform is going to be a challenge. And then there are the FAA risk tolerance percentages which have to be met, for example, on take-off, flying and landing. While these are all hurdles, they are no necessarily insurmountable. Amazon can use airspace outside of the US to test the technology, develop its operating procedures and then present the FAA with a safety case. I

believe to accomplish those tasks with suitable technology and appropriate infrastructure in the US, it will take more than a few years.

Whereabouts are your clients going outside the US in order to test drone technology?A number of my clients are doing testing overseas. Most of this work is going to South America. Some have gone to Mexico.

How will the issuing of regulations in the US affect the regulations in other countries?The US has always been a leader in aviation safety. Knowing the civil aviation authorities of the world, I think that many will follow the US lead because many countries don’t have the resources to research and create regulations applicable to drones – so they will rely on other countries, such as the US.

Have some of your clients gone to Canada to test drone technology?A couple of clients have gone to Canada. Canada still has a better regulatory structure for drone operations than the US but it’s not as easy as going to Canada, turning on the battery and launching it. While Canada has been far ahead of the US, you still need some level of permission in Canada . But my impression is that, once the US has finalized its rules, a lot of civil aviation authorities will use the US model as a way to regulate. It would not surprise me if Canada started using the US rules.

How are the US proposed rules viewed?The Advisory Rulemaking Committees (ARC) came up with proposed regulations, The ‘Unmanned Aircraft Systems (UAS) ARC Recommendation Report (2012)’, a few years ago. The actual final product of the FAA was far more lenient than what the ARC recommended. Many in the industry were surprised by how favourable the rules were.

Where will we be in five years time?Once the rules are in place – probably this year – we’ll see growth in companies that offer services to others – such as drone companies that would contract with a real estate business to film properties for them. There would probably be a pretty big explosion in that kind of consultancy market.

And then railroad companies are interested. So are mining companies, pipeline businesses, gas lines, power plants and others.

In the Pipeline – Next Issue: The development of privacy laws across the US, military and the development of codes of conduct

Once the regulation is in place, Tim Adelman, shareholder in LeClairRyan (which believes it was the first law firm to set up a drone team), expects to see a ‘pretty big explosion’ in consultancies which offer aerial photography and other services to business clients.

Other jurisdictionsSimilar activity is taking place in many countries around the world. Singapore, for instance, introduced drone rules in June. New Zealand, Japan, Canada and Qatar are among the locations where smaller drones are now in operation. New Zealand is to allow Beyond Line of Sight drones from 1 April – although such flights are expected to start in segregated airspace.

Regulation and commercial markets

Lack of regulation ‘is holding the market back’, says Peter van Blyenburgh. This is because insurance will not be provided for the commercial sector on a broad basis until national aviation authorities start authorising and approving pilots and operators in a systematic way.

Development of regulation and other laws

The main regulatory areas driving the sector now are in the fields of manufacturing standards, infrastructure issues and licensing for pilots and operators. But many other sectors are developing too. Privacy and data protection will become a busy area, as will drone flight schools. The commercial insurance sector is starting to see much greater usage of drones by insureds – and a review of practices can be expected in the wake of a significant accident. Industry sectors might also set up their own codes of conduct for issues that are specific to them. The International Association of Chiefs of Police issued its guidance in 2012.

Growth of legal expertiseIn March 2014, LeClairRyan in Maryland set up what it believed was the first drone team in a US law firm. A year later there were at least 13 law firms promoting similar teams. Races of that kind can be expected in many countries around the world. Lawyers will take the lead in pressing for effective regulation in many countries – but the aviation sector is still playing an important lobbying role. In Australia, for instance, an association of operators (the association of Australian Certified UAV Operators Association) published in February 2014 a blueprint for privacy rules.* UVS International is an international non-profit association and the ‘international remotely piloted systems information source’, which works, in co-ordination with regional and international aviation regulators and stakeholder groups, to develop and co-ordinate drone regulation worldwide.


UK view: Q&A

Peter Lee is a drone law expert based in the UK law firm of Taylor Vinters

What is the commercial potential of drones? All predictions are that the commercial and civil market is going to boom over the next decade and there has already been significant investment made by the likes of Facebook, Google and Venture Capital funds. This growth

will be due in part to a large variety of uses for the technology that includes journalism (dubbed ‘dronalism’), facilitating internet and telecommunication platforms in inaccessible or hostile environments, fire and rescue, policing, marketing, precision farming, crop dusting, fire detection, flood monitoring, inspection of oil and gas rigs, pipeline security surveillance and geo-physical surveys.

How long will it take before drone licences are as commonplace as driving licences? Many countries are working on integrating drones into their airspace. The UK has a progressive approach to integration; there are already about 8 00 drone operators with a permission to conduct aerial work from the UK CAA [Civil Aviation Authority]. Other countries, such as the US, have been slower to permit this new technology. The latest US FAA [Federal Aviation Authority] proposals, that are expected to be law next year, offer safety rules for small drones conducting non-recreational operations. The rules would limit flights to daylight and visual-line-of-sight [VLOS] operations, they also address height restrictions, operator certification, optional use of a visual observer, aircraft registration and marking, and other operational limits.

How much of an advantage will jurisdictions have which develop effective drone regulations before others? (For instance, Amazon shifting its piloting out of the US might not seem to bode well for the US getting an early advantage.)There are a few countries around the world where regulations for commercial drone use are now either in place or in preparation. To my mind, Sweden, Japan, France and the UK are leading the way when it comes to integrating drone technologies into their airspace. The UK’s Civil Aviation Authority is an example of a sensible and pragmatic drone regulator. In contrast, many other countries are either not engaging with the drone industry or seem to be approaching the process in a rigidly bureaucratic way. For years now the US had been dragging behind the UK, Europe and other parts of the world because it did not have recognisable, nationwide drone regulations in place and had produced a wide variation of drone-related laws across its states. The best companies in the world are truly global and will move to jurisdictions with permissive regulations that allow them to prove concepts and deploy the technology. This means a country and its people can miss out on jobs, innovation and investment if it does not address the commercial use of drone technology and airspace integration.

How do you expect to see the basic regulations in the UK develop as regards licences for drone pilots and safety in general? The concern for delivery companies like Amazon is that, for the foreseeable future at least, drone operations will generally have to be conducted within visual-line-of-sight of the operator and away from large groups of people. Beyond visual line of sight [BVLOS] operations and more work in busy, congested areas like cities is where regulations need to evolve in the coming years.

How do you expect to see the overall infrastructure on drone use in the UK to develop?The key legal concerns around the commercial use of drones focus on safety, security, privacy, data protection, insurance and liability.

Privacy impact and management is an issue that various stakeholders are very concerned about and the UK Information Commissioner’s Office has recently issued guidance in this area. Airspace and airworthiness regulations continue to evolve around the globe. Spectrum availability issues around the already congested 2.4Ghz that most drone operators currently use is set to become a challenge for operators and this will require engagement by telecoms regulators (such as Ofcom in the UK). As drones become more

automated and a human pilot is less involved in flight, complex issues of liability and responsibility will challenge lawyers and insurers. Also, the spectres of a serious drone accident, espionage, a terrorist incident or protestors using the technology are recognised as threats to our society.

The UK has a good mix of technology, entrepreneurs, permissive regulation and venture capital. I think the single biggest influencer in the drone boom in the UK has been the Civil Aviation Authority.

They have been relatively progressive, open to new technology in the skies and in working with other stakeholders like pilots, the privacy regulator, specialist interest organisations and campaigner groups. They have done all this with a keen eye on safety. The CAA pioneered a risk based approach to drone integration into the airspace and it’s turning out to be the model of choice for much of the developed world. The UK has also been quite active in prosecuting people who break the rules with drones; this is important because it helps to protect professional drone operators, keep things safe and give the public confidence in the application of the technology.

How do you expect to see the basic regulations in the EU develop as regards licences for drone pilots and safety in general?Pan-European coordination for drone regulation is fragmented – basic national safety rules apply but the rules differ across the

“A COUNTRY AND ITS PEOPLE CAN MISS OUT ON JOBS, INNOVATION AND INVESTMENT IF IT DOES NOT ADDRESS THE COMMERCIAL USE

OF DRONE TECHNOLOGY AND AIRSPACE INTEGRATION”

The key legal concerns focus on safety,

security, privacy, data protection, insurance

and liability

Challenges range from spectrum to spying


UK view: Q&A

EU and a number of key safeguards are not addressed in a coherent way. Currently in Europe drones less than 150kg in weight come under the regulation of the relevant national aviation authority – above that weight European regulations apply. A more complex matrix of laws governs flights between states globally, and these include the Chicago Convention provisions and the International Civil Aviation Organisation rules. There are many efforts to move a coordinated European approach forward – for instance under the relatively recent ‘Remotely Piloted Air Systems (RPAS) Roadmap’ that proposes a series of actions to be taken for achieving drone integration into the European air system from 2016. The risk of not adopting or slowly developing drone rules is that some people will simply fly anyway, with no certification or training pathway (as seen in Spain in 2014 and the US).

The EU needs to accelerate harmonisation of drone laws and permission to fly procedures across all Member States. The sooner it does this, the faster companies can take advantage of the Union’s free trade economy. At present if you are a professionally qualified drone operator and want to work in another EU country, there is too much bureaucracy.

Enforcement – how do you expect enforcement to develop? How important will the participation of police be? How important is it that strong enforcement is seen to be happening early on?The law should not be seen as a barrier to the drone industry, it’s about achieving a balance between safety (both physical and privacy) on the one hand and too much red tape on the other. If the rules are too prohibitive or complex, then, as we have seen in the US, folks will just break them and promising businesses could be driven away. To keep competitive we need to be creative, safe and consider all the different ways law and ethics touches drone use. The challenge is for regulators and international bodies to adapt quickly and also to work out who should be responsible for drone activities. For instance, just because small drones fly, are aviation authorities necessarily best placed to regulate them – or are the police or others better suited and resourced?

There are some big legal challenges to be tackled as the industry continues to develop. Key battlegrounds will probably include liability challenges (especially as machines become more automated), privacy and data protection concerns, airspace integration and insurance matters.

About Peter Lee: Peter Lee has one of the world’s leading unmanned system legal practices and advises many drone operators, manufacturers and end users of unmanned systems on a wide variety of regulatory and legal matters. He writes, keeps a blog, often speaks at conferences and has appeared as drone law subject matter expert in the national and international press. He has also appeared as an expert witness at the UK House of Lords’ Select Committee enquiry into the civil use of unmanned systems.

Australia: operator’s view

Joe Urli is chair of the Australian Certified UAV Operators Association (ACUO). He is a non-executive director of the RPAS Coordination Council of UVS International and, a qualified pilot and drone pilot, was formerly an Air Transport & Safety Inspector for the Australian Federal Government.

How difficult will it be to create regulations that will cater for the delivering of parcels by Amazon and others and even pizza delivery?It’s a question of testing the technology in terms of introducing it to the community. Technically it can be done. It’s just a question of the regulatory framework being confident that it can support such services.

Which industries do you see as big users of drones?Lots of industries are looking at drone technology to expand their networks and to save costs. A big driver in organisations now is cost efficiency and the elimination of waste. Examples are mining and oil and gas, as well as law enforcement (through surveillance) and bio-security in the area of environmental control.

Will many lawyers become involved in advising on the use of drones in particular sectors and for start-up drone companies?Most definitely. There is definitely an opportunity for the law faculty to interface with emerging behaviours here. The main three areas of impact are privacy, security and safety.

Q Will having a drone licence become as commonplace as having a driving licence? Possibly. I anticipate that it will because it opens up the market to non-aerospace professionals. I personally believe that it will be like the mobile phone market. The minute that you start interfacing with national airspace, the licensing system becomes mandatory. This is a huge, huge industry that is waiting to realise itself.

When will drones which can be piloted beyond visual line of sight (BVLOS) become a big issue? VLOS (Visual line of sight) is the first step They are stepping stones that regulators are trying to get comfortable with. BVLOS extend the number of variables: they extend the risks. For instance, there is the issue of electronic hijacking – and we have to understand that risk.

New Zealand has leap-frogged Australia on this. I see legislation being passed there before the end of the year [August 1]. When that happens it will have a knock-on effect on other jurisdictions.

Were you surprised at Amazon deciding to test its drone delivery service outside the US? Every country has a different level of maturity. Smaller countries with more mature regulation are probably better positioned to introduce drone corridors and drone delivery systems. It’s probably easier for second world countries. In first world countries there are lots of issues around.

Will activity start first at the smaller end of the market?I suspect that the sub-2 kg class will probably become widespread – because of affordability. I see nano-drones being manufactured at very low cost.

How important is it that regulators get the regulation right?It’s of the utmost importance. This is laying the foundation on which the future will be built. VLOS is the first step. If we can then move on to BVLOS that will be a great enabler. Technology is fast superseding regulatory reform. Regulatory reform needs to be speeded up. We need to get the enforcement strategy bedded down. There are so many recreational drones out there that we can’t really account for.

How important is the RPAS Coordination Council of UVS International? It’s paramount in terms of creating a network in order to harmonise regulations. It is imperative for us to have a common platform. Even harmonising the terminology is important. Our preference at ACUO is to speak of RPASs [Remotely Piloted Aircraft Systems]. In the pipeline – Next issue: Brad Mason, one of the most experienced drone pilots in the world, talks about the development of privacy regulation in Australia.

Will drones become as common as smartphones?


New Zealand: CAA

New Zealand is one of the most advanced countries in the world regarding drone regulation. The Civil Aviation Authority of New Zealand explains the effect of the new rules that take effect from 1 August.

Do you expect that the introduction of the new rules will help create greater use of drones?The new rules are designed to more effectively regulate drones. They will enable some flights to be conducted outside the bounds of the current rules, which could lead to an increase in the use of these aircraft.

What do you think is the potential for drone use in New Zealand? Are there characteristics of New Zealand (such as the large rural spaces) that make it particularly suitable for drones? What the are main areas of interest among New Zealand drone-owners?There is significant potential for increased drone use in New Zealand. Particular areas of interest include agriculture, search and rescue, real estate, film and video production, and scientific research.

Do you expect to update the rules as and when the actual practices of flying drones develop? Yes, the new rules are part of our interim approach. We are developing strategy for the integration of drones into the New Zealand aviation system over the long term.

How will you keep in touch with the views and experience of the drone industry? How important is it to do this?We have very close links with industry, in particular through industry body UAVNZ, whom we have consulted with during the recent rule development process. It is very important that industry are consulted so we can ensure any rules we develop are fit for purpose.

Why did you decide not to make the distinction between commercial and private usage in your rules? Why did you focus instead on the activity being carried out?New Zealand’s Civil Aviation Authority is committed to developing risk-based regulation, to ensure that any rules we develop address the safety risks of a particular activity, rather than considering the purpose of the activity, which may have little bearing on its risk profile.

To what extent do your rules allow for BVLOS [Beyond Visual Line of Sight]? When do you expect BVLOS flying to start?A Beyond Visual Line of Sight is not specifically considered by the new rules, although it would be possible if an applicant could satisfy the CAA that the activity is safe. Given current technology the most likely scenario where BVLOS would be allowed would be in segregated airspace.

Are you feeding in your approach to other regulators in other parts of the world?As a member state of the International Civil Aviation Organization the CAA is internationally connected to regulators in other jurisdictions. We share our knowledge regarding the development of rules for drones with the international aviation community on a regular basis.New Zealand is 7th in the world (in terms of Purchasing-Power-Parity) in terms of GDP per head (US$36,152); and 123rd when ranked by population (4.59m).Sources: IMF and Wikipedia ranking

New Zealand has new rules coming into place on 1 August to regulate the use of drones. The country’s Office of the Privacy Commissioner gives its view on the privacy issues of drone usage.

How many enquiries and complaints are you receiving in relation to drone use?We have received one complaint about drone use and that’s currently under investigation. We do regularly receive enquiries from the public and the news media. For example, we received 18 media enquiries on the topic of drones in the past two years.

Do you think that you will need to issue more detailed guidance as the numbers of private and commercial users increase?We refer people to our CCTV guidelines and to our blog post on the topic. We also refer people to the Civil Aviation Authorities rules on flying Remotely Piloted Aircraft Systems (or RPAS – as it prefers to call them). We have no plans for creating a more detailed guidance solely about drones.

One of the CAA rule changes that will take effect on 1 August means that a person operating a remotely piloted aircraft must avoid operating in airspace above persons who have not given consent for the aircraft to operate in that airspace, and above property unless prior consent has been obtained from any persons occupying that property or the property owner. From our perspective, this has positive privacy implications.

How much are you monitoring the issue – as the technology is advancing fast, as well as usage and activities of other regulators?We are monitoring what other jurisdictions are doing to accommodate drones and it is informing our discussions on dealing with drones.

Are you liaising with other regulators?New Zealand is part of the Asia Pacific Privacy Authorities (APPA), Global Privacy Enforcement Network (GPEN) and the International Conference of Data Protection and Privacy Commissioners (ICDPPC). Drones are subject to discussion at these forums

and we are playing a part in those conversations.

Do you envisage that you will need to talk to different sectors (eg the media in their use of drones for filming; sports organisations as they use drones to film; estate agents when they use drones to film certain large properties; the security forces as they use drones for surveillance…etc) to establish particular codes of conduct in particular sectors? Are you doing this already?We are fortunate that the Civil Aviation Authority [CAA] has taken a leading role in informing different sectors about its rules around using drones. We have been in discussions with the CAA about the development of its new guidelines and we are pleased with the privacy component that is implicit in the rules around obtaining the consent of property owners and occupants when wanting to fly over a property.

In addition, under the Privacy Act, there are clear rules around the use of cameras on drones to filming people. These align with our CCTV guidelines. Failure to comply can lead to a complaint to us which we will investigate. Our blog post about drones is a direct response to the public and media enquiries we have received about drones. We also held a Technology & Privacy Forum (a regular feature of our outreach programme) during Privacy Week that was devoted to the topic of drones.

Anything else you would like to add?While drones are a new and emerging technology, the threat they pose to privacy is consistent with the use of any camera, including mobile phones or automated CCTV systems. The Privacy Act applies to information gathered by an agency about an identifiable individual, and it concerns how that information is collected, handled and disclosed.

But it should be noted there are also other laws in New Zealand that are relevant to using drones to film or record. For example, it is against the law to make covert intimate recordings of people without their consent or knowledge, and to publish them.NEXT ISSUE: The Information Commissioner’s Office in the UK

New Zealand: Privacy

Cutting edge regulation Can the privacy rules keep up with the high-tech advances?


Employment: Drivers of change

James Davies is joint head of employment at Lewis Silkin in the UK

Do you expect a change in the working environment because of the predicted greater use of drones and other types of robots? Will this lead to job losses?Yes. The world of work has always and continues to change. One key driver of change is technology. Many jobs appear, even on the basis of what we now know, to be vulnerable. Even, say, mine

as an employment lawyer which may not be the first you think of as being vulnerable. People are already working on “avatars” who will be programmed to respond to huge numbers of variables in providing legal advice. No doubt, transport jobs will be vulnerable to new ways of getting goods from A to B – whether 3D printing, drones or developments we can’t yet imagine.

We cannot know what the job market will look like in, say, twenty years. At first glance one fears as current jobs become redundant. However, that has always been the case. Many of the jobs that people go into today did not exist merely several decades ago and, no doubt, new jobs, many of which we cannot imagine will replace them.

Do you expect the arrival of drones to affect mainly the manufacturing sector – or other industries (eg post delivery, retail delivery, IT, law enforcement…)?This is very difficult to predict. I wonder whether the physical delivery of stuff won’t actually decline in time.

When moving into an era of greater mechanisation, such as drones, do employers start doing things differently – eg make employment contracts more flexible and less long-term or plan to train staff into the appropriate technology?The world of work is changing quickly and employers are adapting. Going back only a few decades, employment terms were more commonly collectively agreed with trade unions. Individual employment contracts have become much more common since then. With globalisation and increased competitiveness as well as technological and social changes, the 9 to 5 permanent full time employee has become much rarer. Flexibility has become much more important. I wonder if we aren’t beginning to see a move from employment contracts as we know them to a system based less on job security and more on a set of basic rights all workers

hold which provides a degree of protection but facilitates flexibility and acknowledges the need for workers to embrace change.

Are you seeing employers begin to take these steps yet?We are beginning to see a move away from traditional 9 to 5 permanent full time contracts. Part-time contracts, even zero –hours contracts (even though they can, at times but not always, be exploitative) and self-employed arrangements provide for increased flexibility. I think the way forward is to recognise the importance of these flexible arrangements but move away from seeing them as methods to avoid social security payments or deprive workers of basic rights.

Do drones raise privacy or surveillance issues in the workplace?Yes. I predict that privacy issues will become an increasingly topical and important aspect of the employment relationship. Data protection and privacy issues have already become a staple part of an employment lawyer’s diet.

How would you expect the employment law in this area to build up?Case law builds up employment law where laws already exist. New laws can become necessary where law don’t cover developments. These can come from the EU (assuming we stay members) though there has been little in the way of new EU employment law over the last few years. In the field of data protection and privacy, the Information Commissioner has enforcement powers as well as powers to issue codes of practice and the like. As this is an area impacted greatly by new technology developments in this field are perhaps the most likely. You would expect some guidance on the use of drones and privacy (not only in the field of employment) to follow quite quickly upon increased usage.

Anything else you would like to add? Can I refer you to the Future of Work Hub which my firm, Lewis Silkin, has established. This contains information about the changing face of the workplace and we’d welcome comment or contribution of this or other relevant areas (www.futureofworkhub.info).

In the pipeline – Next issue: l Richard Lynch, adviser to low-paid workers and a former negotiator for leading UK trade unions, looks at the role of trade unions as mechanisation developsl Interview with Richard Sission, senior policy advisor at the UK’s Information Commissioner’s Office

Employers start to prepare for robotic world

WORLD ROBOT MARKET EXPECTED TO DOUBLE TO US$20B IN NEXT FIVE YEARS, ACCORDING

TO JAPANESE ROBOT ASSOCIATION


US: state and federal laws

By : Zac ha r y D. Lude ns

Over the last several years, the unmanned aerial system (“UAS” or more colloquially “drone”) industry has begun to blossom while U.S. regulators have fought to keep pace with its development. With increasing pressure from the private sector, a few key regulatory steps give hope that commercial drone use in the U.S. will finally take off. The last few months have brought a proposed regulation from the Federal Aviation Administration (FAA), the streamlining of the FAA’s exemption process, and proposed legislation that would further expedite the process and serve as a gap filler in the interim. In short, it is an

Ready for takeoff?

exciting time for those interested in the U.S. drone industry.

The FAA’s proposed regulations, released on February 15 this year, would apply to small commercial drones – i.e. those weighing 55 pounds or less. Under the proposal, the drones would not be permitted to fly past the line of sight of their operator, could not fly higher than 500 feet, could not operate above people outdoors, and could not operate in certain airspace surrounding airports. The proposal came at the same time that the

American Federal and State governments have a flurry of legislative and regulatory actions on drones — but questions still exist

Zachary D. Ludens, an attorney in the Miami office of the law firm Carlton Fields Jorden Burt, practices in the area of complex commercial litigation and has particular experience in the finance, insurance, intellectual property, and technology sectors.

FAA reported that it had received hundreds of requests for exemption from the ban on commercial drone usage – with the total number of publicly available applications breaching 500 in June.

While the FAA’s eventual regulation of small commercial drones may take months to a year to be finalized and there is no guarantee that U.S. Senators Booker and Hoeven’s introduced Commercial UAS Modernization Act will pass the U.S. Congress, the federal government is not the only governmental body in the U.S. that is paying close attention to the drone industry. The American states have been very active looking to place limits on surveillance by

drones.In calendar year

2014, at least 35 states considered or enacted legislation related to drones. This legislation largely focused around the requirements for state agencies to use drones for surveillance.

...the FAA’s eventual regulation of small commercial drones

may take months to a year to be finalized


What has happened so far on drone regulation2014 2015

CHRISTMAS DAY DECEMBER DECEMBER JANUARY FEBRUARY MAR 18 MARCH APRIL MAY MAY MAY 30 JUNE

US Kenya US UK US US US Florida, USA Singapore Global US South Africa1st 4 licences (s333) given for drone-flying - all for closed-set filming

Blanket ban on drones

Year opens with 9 (s333) licences in place for drone flying

Highway Code review promised

Experimental drone test flights allowed

Amazon gets experimental licence

Amazon patent application published

Extension of Freedom From Unwarranted Surveillance Act to cover drones

Drone rules took effect

Drones and driverless cars will be 2 of 5 new technologies affecting buildings

500th licence (s333) given for drone flying

PRA regs

These are exemption licences to the general ban operated by the FAA


Move to enable testing of driverless cars

FAA gives permission

FAA permit Patent includes ‘Bring it to me’ option of delivery to recipient’s current location - as well as home delivery option

Permit system comes in for commercial drones and others over 7kg

Prediction from Knight Frank ‘Global Cities 2015’ report


Drone flying becomes legal

In late May 2015, the U.S. Department of Justice issued guidelines applicable to its own law enforcement agencies, including the Federal Bureau of Investigations and the Bureau of Alcohol, Tobacco, Firearms and Explosives.

But, later in 2014 and continuing in to 2015, the focus has shifted away from a lone, shining light on government agencies to what privacy protections individual citizens have from one another when it comes to drones. Two great examples are laws enacted in the states of Florida and Texas.

Ahead of the pack, Texas enacted the Texas Privacy Act, which went into effect on September 1, 2013. Under the Texas Privacy Act, it is unlawful to use a drone to capture an image of things “existing on or about real property . . . or an individual located on that property” with the intent to be conducting surveillance on the property or person in the image. The Texas Privacy Act creates a laundry list of exemptions from the underlying assumption of unlawfulness. Many of these deal with specific industries such as the oil industry; some are larger, such as surveillance done for professional or scholarly research.

On May 14, 2015, Florida’s governor signed an act into law that expanded the state’s Freedom From Unwarranted Surveillance Act. Under the act, it is unlawful for any person to take an image using a drone that violates an individual’s reasonable expectation of privacy. In addition, there is an exemption for those licensed by the state if the

surveillance is related to their license. Under the Florida law, an individual that prevails at trial on a claim for violation of the statute can recover double their attorneys’ fees as well as damages and injunctive relief.

But, even with the federal and individual state governments taking action in this arena, there are many questions that remain unanswered.

For instance, how high must a drone fly above privately owned real property before it is not committing a trespass? As far back as the time of the Romans, there was a principle that cuius est solum, eius

est usque ad coelom et ad inferos (“whoever’s is the soil, it is theirs all the way to Heaven and all the way to Hell.”). However, as modern aviation has developed, that tenet of property law regarding air rights has been cut down in the U.S. For instance, one would not prevail against an airline for flying a commercial jet 25,000 feet above his or her home nor against a hospital for flying a medical helicopter a 500 feet above his or her home.

With drones, though, the line is not as clear-cut. Small commercial drones will be limited to a maximum ceiling of 500 feet above surface level, but what will their floor be before a trespass action is risked? Absent a legal certainty of where the property right terminates and open airspace begins, there is always the risk of not knowing. Some states, including Nevada, have taken legislative action setting a maximum height of real property rights in this arena – with Nevada setting the

ceiling for trespass actions against drones at 250 feet above real property. However, Nevada’s statute gives drones one liability-free incident, with a precursor to a trespass action being notification to the drone of a trespass prior to a second incident.

Additionally, as the American commercial drone industry comes into full bloom, there will be a tremendous need for commercial drone liability insurance. With stories like that in late May 2015 where a passenger jet in New York claimed to have swerved to avoid a drone, it is obvious that there could be very large losses as a result of drone usage. Some have criticized the FAA for being too cautious introducing commercial drones into the U.S. aerospace, but the FAA’s empowering act calls upon them to do so without endangering the rest of that space. In the Commercial UAS Modernization Act pending before Congress, there is a requirement for an attestation of insurance coverage for drones that do not otherwise qualify under existing laws.

In the near future, there will continue to be great developments in the area of American drone law. From additional privacy statutes to developments regarding specialty drone insurance policies and further requirements of drone manufacturers and operators to so-far-yet-unforeseen areas of the law, there has never been a better time to be in the drone field. But, the technology will continue to develop at breakneck speeds, and we can only hope that the regulations and law will do the same. Coming soon: How the laws of trespass, privacy and property are struggling to cater for drones by Peter Birkett of Howard Kennedy in the UK

the technology will...develop at breakneck speeds, and we can only hope that the

regulations ...will do the same

US: state and federal laws NEXT ISSUE: THE SWEDISH TRANSPORT AGENCY DISCUSSES ITS SIX YEARS

EXPERIENCE OF REGULATING DRONES


Driverless cars: legal changes

Rinspeed Budii Concept driverless car, as shown at Geneva Motor Show

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2015 is going to be the year in which driverless cars will start appearing on roads on both sides of the Atlantic. Germany, eager to be a pioneer in the auto sector, is working on new laws to allow these vehicles to travel on autobahns. But it will follow behind the US and the UK where Tampa, Florida and Greenwich, near London, will be among the first locations to be regularly ferrying passengers around – probably by autumn.

Insurers and lawyers are among the consortia working on these projects – including insurers AXA and RSA in the UK, for instance, as well as Wragge Lawrence Graham. Wragge is part of a consortium – with Ford, Jaguar Land Rover, Tata and others – that is planning to put three self-driving vehicles on the footpaths of Milton Keynes next year.

The fact that human error is now involved in some 90% of motor collisions will create waves of change for the whole of the industry – perhaps involving the emergence of ‘a complex and rapidly shifting legal position’,

according to Stuart Young, head of the auto group at Wragge. How will the personal injury sector be affected? Responding to Google’s plans for its prototype driverless car, Eric Turkewitz of New York personal injury firm Turkewitz has blogged: ‘The issue of lawsuits regarding the cars will, I think, be vastly overwhelmed by a huge reduction in collisions that result from the most common forms of human error’. And he concludes that ‘the need for my services as a personal injury attorney will be reduced’.

But the developments will take a while for the legal implications to be worked out – perhaps as long as the decade or so before driverless cars are expected to be widely seen on our highways. ‘On legal expenses insurance, I wouldn’t touch it for a while,’ says Steve Manton, formerly chief executive of RSA’s legal expenses

subsidiary in the UK. ‘For driverless cars in a driverless environment it would be fine – but, while you are mixing it up, I can see it being a nightmare.’ Stuart Young of Wragge has written: ‘The mixed use

Self-driving cars will lead to legal overhaul

world is probably the most difficult to legislate for.’

All sorts of legal areas will need to change. The Vienna Convention on Road Traffic, on which most countries base their laws governing transport vehicles, is being changed to update its requirement that ‘every moving vehicle…shall have a driver’. There are also concerns about cyber security – particularly, the shock or terrorist scenario of hackers taking over the controls. The vehicles will create ‘a lot of data’, according to Wragge – making data protection a ‘live issue’ for ‘manufacturers, distributors, operators and owners of connected vehicles’.

The whole approach to the law on accidents might need to change if courts struggle to decide who is responsible for collisions in driverless cars. Stuart Young says: ‘If that becomes too difficult then the UK may need to adopt a new way of dealing with society’s collective risk in the transport infrastructure, for example with strict liability and a revised approach to insurance.’

The launches of the first vehicles will be joyous events – whether they are taking visitors around the Science Museum in Tampa, shuttling concert-goers to Greenwich’s O2 Arena or taking soldiers around in pod cars on the Fort Bragg army hospital base in North Carolina. Many law firms will become involved in various different ways as different legal issues emerge. For instance, UK-based, international firm Osborne Clarke is coming at the issue more from a digital expertise and smart cities angle.

Wragge, however, is the only law firm involved in one of the three consortia developing the first four pilots in the UK – in Bristol and Coventry as well as Milton Keynes and Greenwich. It will be at the heart of the development of new laws for a new transport era. Stuart Young says: ‘While this consortium is addressing the technical issue of whether we can put driverless cars on the public roads, it is also considering how we should do that to ensure society’s broader concerns are addressed. Wragge Lawrence Graham & Co will be reviewing the legal and ethical roadmap, as it were, with a view to issuing White Papers on subjects including data privacy and the development of the law to allow driverless cars.’

‘...the need for my services as a personal injury attorney will be

reduced.’

Neasa MacErlean explains some of the profound implications for lawyers

90% The proportion of car accidents caused by human error


Driverless: insurance

will be desired in terms of the level and range of cover e.g. compensation in case of personal injury suffered in an accident, repairs or replacement of the damaged vehicle, legal fees cover and so on. Although, we might see some extensions to the range of cover to accommodate new risks posed by advancing technology. The type of risk that springs immediately to mind is personal data theft – with the driverless cars of the future looking set to rely on frequent and sometimes permanent internet connection, this opens up the potential for personal data theft.

However, I think we can expect to see a change in the way premiums are calculated – with a very different factual basis being used to assess the level of risk. With the owner becoming less involved in driving the vehicle, because technology is taking their place, previously determinative facts such as age, driving experience, previous convictions will become less relevant (although not totally irrelevant for highly autonomous as opposed to fully autonomous vehicles) in deciding what level of risk an owner presents in driving their vehicle. Human error is currently thought to account for around 90% of the UK’s road accidents – so if human error is removed, there will need to be another way of calculating risk. Instead, there will be a stronger focus on the technology that is incorporated into the vehicle to make it driverless, and whether or not it is proven as reliable or not. The causes of road accidents for driverless vehicles are more likely to be system malfunctions, so reliability of technology becomes especially relevant.

An area of increased complexity for insurance companies to deal with will be working out who is liable in driverless situations. Legally, the law works on the assumption that there is a human driver, someone who is in control of the car. But as the control of the car starts to migrate from traditional human driver to computers, then we will see a change from humans being held responsible, to products – so a move from personal liability to product liability. But then, which product is to blame? As these cars become increasingly complex and sophisticated, so to we may see an increase in the number of different products being placed into a car as a single unit – leading to complex liability claims perhaps with multiple parties responsible for accidents.

Do you think that the insurance will need to develop worldwide or could it just develop as and when needed country by country?As this is such a new area, I anticipate that insurers will evaluate each country on a case by case basis. If the law and regulations are evolving relatively uniformly worldwide (although Europe wide is more relevant as you are more likely to drive between European countries as opposed to between UK and US or India and Australia in the same vehicle) then the insurance industry can consider policies which apply cross jurisdiction. But if different countries take very different approaches – having more stringent rules, or roads less suited to driverless cars – then I anticipate that insurers would take a different approach. Perhaps adjusting premiums accordingly – relating to increased risk – or policies will be limited to certain countries, or owners will have to accept different levels of cover in different countries. As such, different rules could definitely make a difference to how vehicles are currently insured.

How fast will driverless cars take off/ where will we be in 5 years? Do you think that more people will eventually end up buying cars if they are driverless (as, presumably, some people – such as myself – are worried about their driving skills)?I think it is useful to distinguish here between highly and fully autonomous vehicles here. Highly autonomous vehicles, which will still have a driver present to take control, are currently being tested in the UK and I think we could see them on the roads commercially by late 2016 / early 2017. Currently, they are very expensive but, as they become more commercially available, we can expect to see that price drop. As such, we should probably see there being a noticeable interest in buying these vehicles over the next 18 – 24 months. However, bearing in mind that new cars typically make up 10% of the cars on the road at any one time, and not everyone will want to buy a driverless car, we shouldn’t expect a dramatic sea change overnight to driverless vehicles. Also, we can’t forget that some people actually really enjoy driving!

Fully autonomous vehicles are much further off. My view is that society isn’t fully ready for the “living room on wheels” concept from a safety perspective, and also the law doesn’t currently provide for vehicles with no driver.

How important is it to develop insurance for driverless cars? (Ie will the development of them be slowed down if the insurance does not develop well?)Very important – anyone wanting to own a driverless car will need and most likely want insurance. (And when I use the term “driverless” I would tend to focus more on highly autonomous as opposed to fully autonomous vehicles – the former are being tested in the UK now and will reach our streets commercially pretty soon, the latter are, in my view, some way off.) Firstly, it is illegal to drive a car on UK roads without at least third party insurance (and I can’t see that law being waived for driverless cars). Secondly, we are very much a culture which wants to protect ourselves against risk. We know that driving a car holds inherent risks, both for us, passengers and other road users, but insurance gives us protection against the financial elements of those risks.

But, if insurance hasn’t developed sufficiently to accommodate the different liability positions that driverless cars present, and so doesn’t provide the level of insurance protection that potential owners of driverless cars need and expect, that may act as a blocker to the uptake of people purchasing these types of vehicles. One of the first things many people do when buying a car is obtain an insurance quote: if insurance is unobtainable for a car, then it is unlikely to be an appealing investment.

That said, my view is the insurance industry is very attuned to this issue and has already invested a lot of thought and energy in understanding the risks so that it can properly insure – both in terms of setting the correct premiums and ensuring adequacy of cover whilst limiting financial exposure.

What kind of legal issues would be involved? (i.e. just the normal issues for motor insurance or is there more – a higher level of liability if things go wrong, a longer chain of people to blame if, for instance, a driverless car’s systems went wrong; municipal insurance for the towns involved in the driverless car trials….etc?)I don’t believe that the way an insurance policy looks to an owner of a driverless car will change dramatically from how existing motor insurance policies look. Largely similar outcomes

A revamp of laws for robots starts on the roadsClaire Temple of Osborne Clarke explains why the insurance issues must be resolved before the sector takes off

We could expect to

see highly autonomous cars on the

roads by late 2016 or early

2017

CHILDREN BORN TODAY MIGHT BE THE LAST GENERATION WHICH LEARNS TO DRIVE


NEXT ISSUE - SEPTEMBER Features include: AI: Are the three rules of Isaac Asimov a good start? Algorithms: Are they potentially dangerous? Do we need to regulate them? Employment: Can trade unions protect human jobs? Privacy: Q&A with the UK’s Information Commissioner’s Office US: The best way to develop privacy rules on drones Pilot: A view from one of the world’s first drone pilots COMING SOON Update : UK - Property, trespass and privacy - Peter Birkett of Howard Kennedy

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