Government sets wheels in motion for future regulation for Automated Vehicles

10 May 2022

As transportation technology evolves, one of the most significant developments is the evolution of automated vehicles (AVs), capable of driving and performing other tasks without human input. While the mainstream introduction of AVs remains some time away, the Government is seeking to understand their potential impacts on New Zealand roads and users, and how best to regulate this evolving industry.

Last Friday, the Ministry of Transport announced a public consultation exploring the impacts of AVs and the regulatory challenges they present. The Ministry is seeking submissions by 27 May 2022.

What is an Automated Vehicle?

The terminology used to explain automated driving is evolving quickly, and there is no fixed definition of what constitutes an AV. The extent of automation in an AV ranges and can include driver assistance functionalities (e.g. cruise control) at the simpler end, through to fully autonomous systems which operate without any driver input. For the purposes of the current consultation, the Ministry has defined AVs as being (in summary) vehicles with an automated driving system that is capable of driving – including steering, acceleration, deceleration and detecting objects and events – on a “sustained basis without human input.” 

How are AVs currently regulated? 

There is no single framework which currently governs the use of AVs on New Zealand roads. Rather, AVs engage a range of different regulatory regimes, including:

  • Privacy and cybersecurity: Vehicle software systems collect large amounts of personal information about users (such as travel destinations and driving patterns). The collection, use, storage and distribution of that personal information is subject to the requirements of the Privacy Act 2020. The consultation paper notes that AVs will require robust systems to ensure that they are resilient and secure in the face of cyber and physical threats, and emphasises the importance of developing regulation around “third-party apps and aftermarket modifications” (noting as an example that “those who want to use AVs as an office while commuting to work” will require safe and secure network connections).  
  • Transport: New Zealand’s current transport legislation does not prohibit the use of AVs, provided that vehicles comply with applicable requirements for the safe and secure operation of motor vehicles. This is because transport legislation does not currently require the presence of a driver in a vehicle. However, existing transport laws would likely require significant adaptation to address the specific requirements of AVs (including in relation to the enforcement of transport offences).
  • Consumer protection: AVs will also engage consumer protection legislation, including product safety laws and product recall obligations, and consumer guarantees (such as the need to ensure vehicles are of acceptable quality, safe, and fit for purpose).  AVs could also engage financial regulation and AML restrictions (for example, where on-board systems enable payments for services).
  • Other: AVs also raise new issues under a range of existing laws, including the allocation of risks and responsibilities under contract and insurance law.
Key challenges ahead

As the number of motor vehicles on New Zealand roads continues to grow, AV technology provides an opportunity to improve transportation outcomes for New Zealanders and unlock new commercial opportunities. However, they also pose a range of regulatory challenges for New Zealand’s land transport system. 

In particular, a primary regulatory concern with AVs is transport safety. The consultation paper notes the importance of reducing risks for drivers of private AVs, users of shared AV services (such as taxis or ride-sharing) or automated public transport, as well as fellow drivers, cyclists and pedestrians. The degree of automation involved in an AV also raises complex questions about the allocation of responsibility and liability, between human drivers and vehicle software systems, in the event of a crash. 

The Ministry of Transport has not proposed any specific approaches to the regulation of AVs at this stage, but notes that identifying potential gaps in New Zealand’s existing regulatory framework for AVs should be a priority. The consultation paper recognises the value of a clear and coherent framework, noting:

Businesses will want a regulatory environment that supports their individual business models and that has the necessary safeguards and protections built in to protect their ongoing profitability. They will want clarity around insurance rules and regulations, as well as around responsibilities and liability should something go wrong with an Automated Driving System.

The paper also notes that any regulatory changes should provide sufficient lead time to allow the industry to prepare suitably and reduce compliance costs. However, the paper also projects having “regulations in place within five years” and that such regulations should “align with other relevant regulatory development in areas like cybersecurity and data privacy.”

Consultation and next steps

The Ministry of Transport is seeking submissions on the consultation paper (to be provided in the form of a survey) by 27 May 2022. The output of the consultation will be presented to a Select Committee at the end of June 2022 and will be used to inform future policies on regulating AVs in New Zealand.

Given the complexity of the technology and the range of regulatory issues it raises, we expect it will take some time for proposed legislation to crystallise. That said, this consultation offers a valuable opportunity for industry participants to influence the direction of travel, at an early stage, for what could prove to be a transformational technological shift.

If you would like to further discuss the implications of AVs for you or your business, or require assistance in preparing submissions, please get in touch with the authors or your usual Bell Gully adviser.

Disclaimer: This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.