Unmanned territory

Answer

Drone technology in the commercial world

Unmanned aircraft vehicles, or ‘drones’ as they are better known, are becoming increasingly popular around the world and so too are they becoming more important in the commercial sphere. Aside from their military applications, which is well documented with the United States’ use of drones in the Middle East, civilian uses now include taking photos or videos, helping map remote areas, undertaking land surveys and inspections of industrial infrastructure, and agricultural monitoring.

They are also being developed as a delivery method, with companies such as Google and Amazon testing their own drone delivery systems as a method of transporting goods quickly and cheaply to people’s homes. There is therefore far more potential to this technology than the inexpensive remote-controlled toys that are now widely sold. In response to this potential, the law must adapt quickly to create a safe environment for the public while not stifling drone development. It is at this intersection of technology and regulation where the unique opportunity exists for lawyers to control, but also promote cutting-edge technology.

Regulation

There have already been legal provisions made for the use of unmanned aircraft. Drones above a certain size in the UK are now subject to the governance of the Civil Aviation Authority (CAA), the body responsible for the regulation of aviation safety in the UK. Any drone weighing more than 250g in the UK must legally be registered with the CAA, which also has written policies on how drones can be used and the rules that pilots must follow. For example, you cannot have any object or animal dropped from a drone, as this could endanger people or property. While this seems obvious, the CAA provides clear guidelines to which drone pilots can refer to ensure that they are flying their drones in a legal and responsible manner. Importantly, it also provides the means to legally sanction the misuse of drones.

The strength and scope of the law is crucial when considering the events of December last year when a drone wreaked havoc at Gatwick Airport by entering the airport’s airspace. The incident caused thousands of flights to be cancelled and millions of pounds to be lost from the British economy. While there were laws governing the use of drones, the seriousness of this drone’s reckless use meant the law has had to be reconsidered. For example, drones are now restricted from flying within three miles of an airport, rather than the previous 0.6-mile exclusion zone. In addition, under previously introduced regulations, drones are restricted from flying above a height of 120 metres. Companies, drone pilots and the lawyers who advise them must be mindful of this and any future legislation introduced to supplement these regulations.

Other considerations

Insurance is another area that drone users must increasingly consider and one in which lawyers will be able to advise, both in helping to create suitable policies but also in appreciating when clients will be required to insure themselves. While there is no legal requirement for private drone users to have insurance cover in place, there is a legal requirement for commercial drone pilots to have coverage. This is to protect pilots against accidental injuries or damages inflicted by their drone. This is separate from insurance cover for the drone itself and is purely to protect the pilot against claims for bodily injury caused to bystanders or property damage, to name but two examples. Insurance policies for commercial drone use which are currently available range from flight-specific insurance policies to wider commercial general liability policies. Depending on the type of policy needed and how much one is willing to spend, policies can be bought ‘on-demand’, such as on an hourly basis, or alternatively as an annual policy. As drones grow in size and capability, policies will likely become similar to those offered for commercial aircraft.

The future of drones

As laws and regulations surrounding the use of drones develop and as industries which support their use such as the insurance industry also adapt to this new technology, law firms will need to offer clients relevant advice to ensure they are acting safely and legally. It is also possible that drones will, within the lifetimes of many, reach a size which puts them in competition with manned commercial aircraft. There are already companies which specialise in the development of cargo-carrying drones with the aim of replacing manned aircraft in the air freight business. This may mean that law firms which specialise in aviation may soon be asked by clients to handle sales, financings and leases, as well as advise on regulatory issues or financing surrounding large drones and their use. Equally, this provides an opportunity for law firms with experience in aviation and asset finance to develop their practice and win new business. If lawyers are to be able to offer sensible commercial advice, they will quickly need to appreciate where the value in the drone lies as an asset and how best to protect the interests of its client, whether advising a lender taking security over an unmanned aircraft or a company owning or operating one.

It is difficult to predict how drones will be developed and which industries they will be used in most. This, however, only adds to the necessity for lawyers to be able to adapt to this rapidly developing and exciting technology and to monitor it closely.

Zahra Knapper, Hugh Brünjes and James Charteris-Black are, respectively, associate and trainee solicitors at White & Case.