Automated and Electric Vehicles Act 2018

Commentary on provisions of Bill/Act

Part 1: Automated vehicles: Liability of insurers etc.

Chapter 1: Policy Background

11. Automated vehicles are those that have the capability of driving themselves without human oversight or intervention for some, or all, of a journey. In an automated vehicle the driver can, in at least some circumstances or situations, hand all control and responsibility to the vehicle and effectively become a passenger, using it in automated mode. United Kingdom law on compulsory motor insurance has focused historically on ensuring that victims of road traffic collisions are compensated quickly and fairly. In the case of an automated vehicle being operated in automated mode, however, accidents could take place not as a result of human fault, but because of a failure in the vehicle itself, for which the only recourse available to an otherwise uninsured victim might be to sue the manufacturer through the courts. This Part extends compulsory motor vehicle insurance to cover the use of automated vehicles in automated mode, so that victims (including the ‘driver’) of an accident caused by a fault in the automated vehicle itself will be covered by the compulsory insurance in place on the vehicle. The insurer would be initially liable to pay compensation to any victim, including to the driver who had legitimately handed control to the vehicle. The insurer then would have the right to recover costs from the liable party under existing common and product law.
12. On 11 July 2016 the Department for Transport published a consultation document entitled Pathway to Driverless Cars: proposals to support advanced driver assistance systems and automated vehicle technologies1. The consultation put forward proposals for the extension of the compulsory insurance requirement as set out above, so that victims would have a direct route of recovery through the insurer in the same way as they would if involved in a conventional collision where the driver was at fault.
13. The Government published its response to this consultation on 6 January 2017 and confirmed its intention to bring forward its proposals.2

Section 1: Listing of automated vehicles by the Secretary of State

14. This Section contains a mechanism to allow for manufacturers, owners of vehicles and insurers to know if the scope of this legislation applies to their vehicle. This mechanism comprises a list, prepared and updated by the Secretary of State, of motor vehicles that come within a two part definition in sub-Sections 1(1)(a) and (b), which should be read with Section 8(1)(a)’s interpretation of ‘driving itself’.
15. Subsection (2) requires the Secretary of State to list vehicles, identified by type or in some other way, that are automated. Subsection (3) requires the Secretary of State to publish the list, and make an updated list available each time that it is revised.

Section 2: Liability of insurers etc. where accident caused by automated vehicle

16. Section 2(1) places first instance liability on the insurer for an accident caused by an automated vehicle on a road or other public place in Great Britain if the vehicle is insured. Subsection (2) also places the same liability on certain types of owners where the vehicle is not insured due to being exempt from compulsory third party insurance under Section 144(2) of the Road Traffic Act 1988 (such as in the case of vehicles owned by a local authority, a police body, a health authority or NHS trust). As compared with the compulsory insurance cover for conventional vehicles under Section 145 of the Road Traffic Act 1988, the insurer’s liability under subsection (1) is widened to include damage (as defined in subsection (3)) to the driver where the automated vehicle is driving itself.
17. Subsection (6) provides that the liability on the insurer cannot be limited, except when Section 4 applies. Subsection (7) ensures that the liability imposed on the insurer by this Section does not undermine their right of recovery from parties who are responsible for an accident.

Section 3: Contributory negligence etc.

18. This Section applies contributory negligence principles to the apportioning of liability in relation to accidents involving automated vehicles, where the injured party to some extent caused the accident or the damage resulting from it.

Section 4: Accident resulting from unauthorised alterations or failure to update software

19. This Section allows insurers to exclude or limit their liability to the insured person for accidents caused by the vehicle’s software being altered in breach of the insurance policy, or by safety-critical software updates not being applied. This applies subject to various conditions regarding the level of knowledge of the insured person or policyholder about the need for updates or about related insurance policy requirements.

Section 5: Right of insurer etc. to claim against person responsible for accident

20. Where Section 2 imposes an initial liability on the insurer or owner of the automated vehicle in respect of the accident, Section 5 provides that any other person liable to the injured party in respect of the accident is under the same liability to the insurer or vehicle owner. This Section defines when and how the amount of such a person’s liability is settled and when their right of action accrues. It also sets out arrangements and limits on the amounts they can recover.

Section 6: Application of enactments

21. This Section has the purpose of preserving the various forms of liability in measures such as the Fatal Accidents Act 1976, the Damages (Scotland) Act 2011, and all the other Acts to which this Section refers, and ensuring that the new system of liability being created by this Act is joined up with them. For example, the Fatal Accidents Act 1976 provides for a victim’s dependents to be able to recover damages where the victim’s death was caused by "wrongful act, neglect or default". This form of liability from the Fatal Accidents Act 1976, by means of this Section, is being preserved and linked to the system of liability being created by this Act, such that where an accident involving an automated vehicle causes death, it will be deemed to be due to the liable person’s "wrongful act, neglect or default" within the meaning of the Fatal Accidents Act 1976, so that the provisions of that Act are brought to bear. The effect of the other provisions is being similarly linked to the relevant provisions of this Act.
22. Subsection (4) clarifies that the liability being created in Section 2 is liability in tort, as opposed to liability in contract or criminal law.

Section 7: Report by Secretary of State on operation of this Part

23. This Section requires the Secretary of State to lay a report, two years after the list of automated vehicles is first published, detailing the impact and effectiveness of Section 1. This report must also include an assessment of the extent to which the provisions of Part 1 ensure that appropriate insurance or other arrangements (as detailed in Section 2(2)(c)) are made in respect of vehicles that are capable of safely driving themselves.

Section 8: Interpretation

24. This Section defines terms used in Part 1.

Schedule: Minor and consequential amendments

25. The Schedule to the Act is introduced by Section 20 and makes several minor and consequential amendments in relation to automated vehicles.
26. Paragraphs 1 to 7 make amendments to the Prescription and Limitation (Scotland) Act 1973 to make a similar regime of limitation on legal actions for automated vehicles as the one in the Limitation Act 1980 for England and Wales, but specific to Scottish law.
27. Paragraphs 8 to 16 insert provisions into the Limitation Act 1980 to establish a regime of limitation on actions regarding automated vehicle accidents, both under Section 2 and under Section 5. The purpose of these paragraphs is to provide for a clear time limit which avoids uncertainty arising from differences between existing limitation periods relating to product liability and personal injury.
28. Paragraphs 17 to 21 insert provisions into Part VI of the Road Traffic Act 1988 which extend the compulsory insurance requirement in respect of third party risks to cover automated vehicles in an adapted manner. For example, the compulsory insurance for an automated vehicle will include more than just third party victims and is extended to cover the disengaged driver where the accident takes place when the vehicle is in automated mode (see paragraph 19(2) which inserts subsection (3A) into Section 145 of the Road Traffic Act 1988). The option which currently exists for conventional vehicles, as an alternative to holding a third-party insurance policy, of depositing a security with the Accountant General of the senior courts, will not be available for automated vehicles.

Part 2: Electric Vehicles: Charging

Chapter 2: Policy background

29. The Government has stated that by 2050 nearly all cars and vans should be zero emission vehicles (zero carbon dioxide and other harmful tailpipe emissions). Government funding and private investment have already led to the development of more than 14,000 public charge points, and an initial network of hydrogen refuelling stations. Hydrogen-powered vehicles contain fuel cells which convert hydrogen into electrical energy to power the vehicles. Although the power for the electrical energy originates with hydrogen they are still considered electric vehicles. Significantly increased provision of the infrastructure relating to charging electric cars and refuelling hydrogen powered cars will be required to support mass market uptake of electric vehicles.
30. At present, in the early market, there are multiple networks with different offers to consumers. The accessibility and convenience of vehicle charging and refuelling is frequently raised by consumers as a key concern in choosing to purchase and use an electric vehicle.
31. Electric vehicle charging has the potential to avoid network pressures and capitalise on cheaper off peak electricity generation by modulating or delaying charging. The use of ‘smart’ charge points will help enable these services, and could provide savings to electric vehicle owners and energy bill payers.
32. On 24 October 2016 the Department for Transport and the Office for Low Emission Vehicles published a consultationdocument proposing ultra-low emission vehicles measures for inclusion in the Modern Transport Bill.3 The consultation put forward proposals for new legislative powers which would allow the Government to introduce regulations to address the priorities discussed in the consultation to improve the electric vehicle infrastructure.
33. The Government published its response on 9 February 2017 and confirmed its intention to bring forward its proposals, with the detail informed by consultation input from stakeholders and members of the public.4

Section 9: Definitions

34. This Section provides definitions of the nomenclature used in Part 2.

Section 10: Public charging and refuelling points: access, standards, and connection

35. Section 10 provides a power for the Secretary of State to make regulations which address a current problem with the diversity of different means of accessing public charging point services. Regulations could require operators to provide an appropriate uniform method of accessing public charging points and refuelling points. Although recent EU legislation now mandates that access to charge points must be offered without membership, there remain many differing methods of access. For example, at the moment consumers may be required to access a charging point via SMS, or text or smart phone application. This Section will enable a common method of payment or access to be mandated in regulations. In addition, the Section enables regulations which could address any lack of interoperability between public charging point connectors or sockets. This would ensure that an electric vehicle could charge at any public charging (or refuelling) point. The Section also enables regulations to be made that would enable the Secretary of State to set availability, maintenance and performance standards for public charging infrastructure. This would help to increase the number and reliability of charging or refuelling points available for use by the public at any given time.

Section 11: Large fuel retailers etc.: provision of public charging and refuelling points

36. This Section provides the Secretary of State with the power to make regulations requiring large fuel retailers and service area operators to provide public charging points and to ensure that public charging points are maintained and easily accessible to the public. For example, regulations could provide that public charge points are available 24 hours a day, and supported by a maintenance service.

Section 12: Duty to consider making regulations under Section 11 on request by elected mayor

37. Section 12 provides elected mayors (the Mayor of London and Mayors of combined authorities) with the power to ask the Secretary of State for Transport to make regulations under Section 11. The power would be limited to large fuel retailers in the area within their authority. Mayors would be required to consult on such proposals, and notify the Secretary of State of the intent for regulations to be made, who must then consider whether to make such regulations. If the Secretary of State decided not to make such regulations, the Secretary of State would be required to notify the mayor of the reasons for this. The Secretary of State would not be obliged to consider a request to make regulations unless ‘large fuel retailer’ had already been defined in regulations.

Section 13: Information about public charging points

38. Section 13 provides a power for the Secretary of State to make regulations which address the lack of consistency in the content and format of publicly available information on public charging points. It is currently open to each charge point operator to decide what information it makes available in relation to its charge points. The Secretary of State will be able to make regulations to place an obligation on charge point operators to make certain types of information (including real-time data comprising a live feed of current availability) publicly available in an open and transparent format – this data could be used by third party app developers for example to provide certainty to the consumer.

Section 14: Transmission of data relating to charge points

39. This Section provides the Secretary of State with a power to make regulations to ensure the ongoing transmission of data from charge points to specified persons (who could include the National Grid and electricity distribution network operators). Regulations may also specify the type of data which is subject to the obligation, as well as the form in which it is to be transmitted.
40. Subsection (3) provides that where regulations relate to public charge points the obligation to transmit data will be placed on the operator of the public charge point.
41. For non-public charge points regulations may prescribe the persons who will be similarly obligated. Subsection (4) clarifies that such persons do not include owners or occupiers of domestic premises. However, if a prescribed person (who could include a company such as a charge point operator) also owned a domestic property, then the intention is that requirements would still apply to them in their capacity as a prescribed person.

Section 15: Smart charge points

42. This Section provides the Secretary of State with the power to introduce regulations prohibiting the sale or installation of charge points in the United Kingdom, unless they meet certain requirements, which will be prescribed in regulations. This includes charge points that may be given away for free or on hire (for example, as part of the sale of a vehicle).
43. Subsection (2) provides that the prescribed requirements may include (but are not limited to) requirements that relate to technical specifications for a charge point, such as "smart" functionality, and provision about the ability of the charge point to: send and receive electronic communications to and from a third party; react to the information sent or received from the third party and adjust the charge point’s charging (or discharging) rate; monitor and record the charge point’s own energy usage; comply with sufficient security requirements to ensure that it is resilient to a cyber-attack or other types of attack; achieve energy efficiency standards, and to be capable of being accessed remotely.

Section 16: Enforcement

44. This Section confers power on the Secretary of State to make regulations so as to enforce compliance with the requirements in this Part. These regulations may set out a civil penalty regime and the process for determining whether there has been a failure to comply with any of the requirements. It is likely the Secretary of State will identify and nominate an existing body to undertake enforcement of any regulations. For example, if it is found by the enforcement authority that there has been a failure to comply, the enforcement authority will be able to issue a financial penalty that is payable into the consolidated fund.
45. Subsection (3) provides that regulations may make provision for conferring powers which may be required in determining whether a breach of the requirements has taken place. These include a power to enter any land, to inspect documents or things, and to remove any thing for testing or inspection.

Section 17: Exceptions

46. This Section allows the regulations to create exceptions from the requirements under this Part. The exceptions can apply to persons or devices. This ensures that the requirements are not unjust or too onerous.

Section 18: Regulations

47. This Section sets out what regulations made under this Part may do and contain, and the Parliamentary procedure to which the power to make any such regulations is subject.

Section 19: Report by Secretary of State on operation of this Part

48. This Section places an obligation on the Secretary of State to lay a report before Parliament annually, commencing two years after the day on which this Act is passed, assessing the impact and effectiveness of regulations made under this Part and the need for other regulations to be made under this Part during subsequent reporting periods.

Part 3: General

Section 20: Minor and consequential amendments

49. This Section confers on the Secretary of State a general power to make consequential provision in relation to any provision of the Act. The power includes power to amend primary legislation passed before the end of the Session in which the Act is passed. This power is subject to the affirmative resolution procedure in cases in which the power is exercised in relation to primary legislation (subsection (5)) and the negative resolution procedure in all other cases (subsection (6)).