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New regulations on commercial drones: what can we expect?

New regulations on commercial drones: what can we expect?

The market for commercial drones is about to take off – drone technology is likely to attract around $90bn of investment in the next decade, and commercial drones could become worth 10 per cent of the total aviation market. But the fast-evolving technology needs a legal framework to cover standards for: 

  • safety;
  • security;
  • privacy;
  • data protection;
  • insurance; and 
  • liability. 

There are already 1,700 different types of drones – technically described as ‘remotely piloted aircraft systems’ (RPAS) or ‘unmanned aircraft systems’ (UAS) – produced by some 500 official manufacturers worldwide, with about a third in Europe. 

Drones need to be integrated into the non-segregated airspace – the same airspace used by ‘piloted’ air traffic. To gain public acceptance and trust, commercially operated drones have to be at least as safe as piloted aviation.

Can regulation create competitive advantage?

Important regulatory decisions on using drones commercially are expected this year, both in the EU and the US. Neither region has harmonised rules in place at the moment. 

Current position

In the EU, the European Aviation Safety Agency (EASA) is responsible for unpiloted aircraft over 150kg. Member states are responsible for unpiloted aircraft up to this weight. Many member states have their own rules in place or are developing them. 

Operating a civil drone in the US requires not only an airworthiness certificate under federal law but also compliance with state law. About a dozen states have statutes dealing with drones, and more are considering enacting them.

The EU Commission aims to integrate civil drones into the European aviation system from 2016 onwards by creating a common safety regulation framework and by developing the technologies needed to enable it. It also intends to protect its citizens and support the development of the European market with: 

  • rules on safety authorisations; 
  • controls on privacy, data protection and security; 
  • a framework for liability and insurance; and 
  • streamlined R&D and support for new industry.

The US Federal Aviation Administration (FAA) develops regulations and policy to promote safe and efficient drone operations in national airspace. It too is considering questions of safety, data protection and privacy, and third-party liability and insurance. 

The FAA is required under the FAA Modernization and Reform Act, passed by Congress in 2012, to have regulation in place that will safely integrate civil drones into national airspace by 30 September 2015. Although the FAA proposed a rule governing small drone operations (up to 55lbs/25kg) in February 2015, it seems unlikely it will have regulation governing heavier drones in place to meet the September 2015 deadline.

Impact of harmonisation

Establishing harmonised regulations for commercial drones could have a big impact on this growing market. Companies that develop and use drones will probably prefer more comprehensive regulatory frameworks for their commercial drone operations (as well as test sites). And the region that establishes a reliable legal framework more quickly will probably offer its industry a competitive advantage.

Who leads the way?

When it comes to technology, the US – given its experience with military drones – still seems to be in a better starting position for the emerging commercial drone market. 

As far as the regulatory framework goes, the frontrunner is less obvious. In some fields, such as liability, the EU might actually be closer to delivering the legal certainty the public and industry long for.