OVERVIEW OF THE AUTOMATED AND ELECTRIC VEHICLES ACT 2018

Published July 7, 2021 · Updated July 7, 2021

The Automated and Electric Vehicles Act 2018 (the AEV Act 2018) describes itself as “An Act to make provision about automated vehicles and electric vehicles”. It is an Act in three parts:

Part 1: “Automated vehicles: liability of insurers, etc”

Part 2: “Electric vehicles: charging”

Part 3: “Miscellaneous and general”

Part 1 is of particular interest to litigants, as it creates:

a new, direct action against the insurer or owner of an automated vehicle, for the victim of an accident caused at least partly by an automated vehicle when driving itself, and
a means for an insurer or owner thus liable to claim against a person responsible for the accident.

Policy Background to Part 1 of the AEV Act 2018

Upon its enactment in July 2018, Part 1 of the AEV Act 2018 extended third-party compulsory motor insurance, for a driverless future. As the House of Commons library briefing paper on the AEV Act 2018 put it, in August 2018:

“The application of ‘intelligence’ to cars is gathering pace and there is a strong push by manufacturers to develop automated vehicles which will drive themselves. Currently, insurance law is driver-centric: all (human) drivers have to have insurance in order to provide compensation for third parties for personal injury or property damage due to a driving related incident. The Government’s view is that such principles need to be extended to cover automated vehicles when the car is the driver and the ‘driver’ is sometimes a passenger. The intention behind the legislation is to emphasise that if there is an insurance ‘event’ (accident) the compensation route for the individual remains within the motor insurance settlement framework, rather than through a product liability framework against a manufacturer” (page 3).

The AEV Act 2018 provides this by a direct action against the insurer of an automated vehicle under Section 2(1), which provides as follows:

2 Liability of insurers etc where accident caused by automated vehicle

(1) Where –

(a) an accident is caused by an automated vehicle when driving itself on a road or other public place in Great Britain,

(b) the vehicle is insured at the time of the accident, and

(c) an insured person or any other person suffers damage as a result of the accident, the insurer is liable for that damage.

The policy behind that direct liability was the avoidance of complex product liability claims in road traffic cases involving automated vehicles (AVs), whose arrival was thought to be “gathering pace”. As the House of Commons library paper put it:

“The key policy point in this section is that following a claims ‘event’ the process follows the insurance route – as now – rather than becoming a ‘consumer-manufacturer’ product liability action, which is inevitably longer and more costly.” (page 10)

Summary of the Provisions of Part 1 of the AEV Act 2018

There are eight sections in Part 1 of the Act. By section number, each provides (in summary) for:

1. Listing of automated vehicles by the Secretary of State. The mandatory duty of the Secretary of State for Transport (SST) to prepare, publish and keep up to date a list of all motor vehicles which are, are in the SST’s opinion, designed or adapted to be capable, in at least some circumstances or situations, of safely driving themselves, and which may lawfully be used when driving themselves, in at least some circumstances or situations, on roads or other places in Great Britain. Defines “automated vehicle” in Part 1 AEV Act 2018 as meaning “a vehicle listed under this section” (section 1(4)).

2. Liability of insurers etc where accident caused by automated vehicle. The key section of Part 1 of the AEV Act 2018, providing that, where an accident is caused by an automated vehicle when driving itself on a road or other public place in Great Britain, the vehicle is insured at the time of the accident, and an insured person or any other person suffers damage as a result of the accident, the insurer is liable for that damage (or, where a public body or the Crown is permitted to use the vehicle without insurance, that owner is so liable). Section 6(4) (below) provides that liability under section 2 is treated as liability in tort or, in Scotland, delict for the purposes of any enactment conferring jurisdiction on a court with respect to any matter.

3. Contributory negligence etc. Preserves the reduction of damages for which the insurer or owner is liable, by reference to any contributory fault of the injured party. Sets the standard by which the fault of the automated system will be assessed, in the balancing of contributory faults, as that which “would apply to a claim in respect of the accident brought by the injured party against a person other than the insurer or vehicle owner”. The Law Commission and others have challenged the clarity of that language, but it might be that it provides for a notional human comparator in place of the car, to avoid difficult comparisons between human and machine reasoning when assessing comparative fault. Section 3(2) provides for an extinction of the section 2 liability of the insurer or owner of an automated vehicle to the person in charge of the vehicle “where the accident that it caused was wholly due to the person’s negligence in allowing the vehicle to begin driving itself when it was not appropriate to do so”.

4. Accident resulting from unauthorised software alterations or failure to update software. Allows the insurer to avoid or limit its liability under section 2 by excluding or limiting cover in the policy for damage suffered by an insured person arising from an accident occurring as a direct result of prohibited software alterations made by the insured person, or a failure to install safety-critical software updates that the insured person knows, or ought reasonably to know, are safety-critical.

5. Right of insurer etc to claim against person responsible for accident. Allows the insurer to seek contribution to its liability to the injured party, where the amount of that liability (including any liability not imposed by section 2) is settled, from any other person liable to the injured party in respect of the accident.

6. Application of enactments. Provides for the application of other Acts. Of note are (1) that, for the purposes of various Acts, the behaviour of the automated vehicle is deemed to be the fault of the person liable under section 2 AEV 2018 (sections 6(1) to (3)); (2) the tortious nature of the section 2 AEV 2018 remedy for jurisdictional purposes (section 6(4)); (3) the exclusion (at section 6(5) AEV 2018) of the Civil Liability (Contribution) Act 1978, if the insurer or owner seeks the right to claim against another liable person under section 5 of AEV 2018.

7. Report by the Secretary of State on operation of this Part. Requires SST to lay before Parliament, not later than two years after the first publication of the list of automated vehicles under section 1, a report assessing the impact and effectiveness of Part 1 of AEV Act 2018 and the extent to which that Part’s provisions ensure that appropriate insurance or other arrangements are made in respect of vehicles that are capable of safely driving themselves.

8. Interpretation. The interpretation section in relation to Part 1. Section 8 defines “automated vehicle” as having the meaning given by section 1(4) (which reads “In this Part “automated vehicle” means a vehicle listed under this section”, i.e. the section 1 list of safe and lawful automated vehicles prepared by SST). But section 8(1)(a) adds a further element to the definition within section 1, by elaborating upon the meaning of the phrase “driving itself”. Section 8(1)(a) provides that “For the purposes of this Part – a vehicle is “driving itself” if it is operating in a mode in which it is not being controlled, and does not need to be monitored, by an individual”. That further definitional element – “and does not need to be monitored” – has spurred debate as to whether or not vehicles with the automated lane keeping system (ALKS, also know as “traffic jam chauffeur”) should be listed under section 1 AEV Act 2018, as the Secretary of State for Transport has indicated he expects to do (see the discussion below). Section 8(3) provides that a reference to an accident includes a reference to two or more causally related accidents, and that a reference to an accident caused by an automated vehicle includes a reference to an accident that is partly caused by an automated vehicle.

Limitation periods for actions under the AEV Act 2018 are set by Part 3 (“Miscellaneous and General”), section 20(1), and in the Schedule to the Act (by amendment of the Limitation Act 1980), which in particular sets primary limitation periods for:

the direct action against an insurer or owner under section 2 AEV Act 2018 of not after the expiration of 3 years after the accident or date of knowledge of the person injured (if later). See section 11B of the Limitation Act 1980, as amended; and
the insurer or owner’s “claim against person responsible for the accident” action under Section 5 AEV Act 2018 of not after the expiration of two years from the date of the settlement of the amount of the insurer’s or vehicle owner’s liability to the injured party in respect of the accident (including any liability not imposed by section 2). See section 10A of the Limitation Act 1980, as amended.

Under Part 3 of the AEV Act 2018, the Secretary of State for Transport has a power by regulations to make provision that is consequential on any provision made by the Act (section 20(2): “minor and consequential amendments) and to bring the Act into force (21(2): “Commencement”). The power to make regulations to commence the Act is exercisable by statutory instrument (ibid) and may appoint different days for different purposes or different areas (21(4)(a)).

A statutory instrument containing regulations under Section 20 of the AEV Act 2018 (“Minor and consequential amendments”), any of which amend, repeal or revoke primary legislation (which includes legislation of devolved assemblies: (20(7)) may not be made unless a draft of the instrument has been laid before Parliament and approved by a resolution of each House (20(5)). A statutory instrument containing regulations under Section 20 none of which amends primary legislation is subject to annulment in pursuance of a resolution of either House of Parliament (20(6)).

The Schedule to the AEV Act 2018 also makes clear that it is not open to the owner of an automated vehicle, as an alternative to insuring the AV, to make a deposit of a sum with the Accountant General of the Senior Courts (by the AEV Act’s amendment of the Road Traffic Act 1988 to that effect – see paragraphs 17 and 18 of the Schedule).

Commencement of the AEV Act 2018

The bringing-into force of the Act, without the list of automated vehicles to which it would apply, required some explanation. That explanation came a week after the commencement of the Act, at pages 41 and 43 of a document from the government’s Centre for Connected and Autonomous Vehicles (CCAV) published on 28 April 2021 (see below). As the absence of the list implied, the explanation related to the vehicles that would be subject to the Act.

Vehicles Subject to the AEV Act 2018

The 2018 Act, enacted in July 2018, had sought to avoid complex and expensive product liability claims becoming a feature of road traffic accident claims by primary victims. Questions remained, however. In particular, there was the difficult question of when the Act would come into force. The 2018 Act legislated for a future technology. How to know when that technology had arrived? After much debate – informed to a large extent by discussion of the of the levels of vehicle automation – parliament defined “automated” vehicles in the AEV Act 2018 (in section 1(1), cited in 1(4) and 8(2)) as:

“all motor vehicles that—

(a) are in the Secretary of State’s opinion designed or adapted to be capable, in at least some circumstances or situations, of safely driving themselves, and

(b) may lawfully be used when driving themselves, in at least some circumstances or situations, on roads or other public places in Great Britain.”

However, during debate on the AEV Bill, parliament had also elaborated upon the definition, adding a refinement which was enacted within the “Interpretation” section of Part 1 of the Act, at section 8(1)(a):

“(1) For the purposes of this Part—

(a) a vehicle is “driving itself” if it is operating in a mode in which it is not being controlled, and does not need to be monitored, by an individual;”

It is that refinement of the definition of “automated vehicle” – “does not need to be monitored” – which has become a focal point of debate over the place within British motor insurance law of the Automated Lane Keeping System (ALKS).

ALKS is a system which steers and controls vehicle speed in lane for extended periods on motorways at speeds of 60 km/h (37 mph) or less. International regulation has been available since June 2020 (in the United Nations Economic Commission for Europe ALKS regulation). But whether or not ALKS needs to be monitored by the user of the vehicle (in current, everyday language, the driver) is a point of deep controversy.

Thatcham Research (the automotive research centre of the British insurance industry) has long urged the government not to classify a vehicle with ALKS as automated under the 2018 Act, citing “some concerning scenarios where ALKS may not operate safely without the driver intervening”.

On 21 April 2021, Part 1 of the AEV Act 2018 was brought into force, by the Automated and Electric Vehicles Act 2018 (Commencement No. 1) Regulations, SI 2021/396. However, no list of automated vehicles under section 1 of the Act was then published by the Secretary of State. A week later, on 28 April 2021, the British government’s Centre for Connected and Autonomous Vehicles (CCAV) published its paper ‘Safe Use of Automated Lane Keeping System (ALKS): Summary of Responses and Next Steps. Moving Britain Ahead’. It took a different path to that recommended by Thatcham Research. In that paper, CCAV announced that the government:

“expects that vehicles fitted with ALKS for use on GB roads will be automated vehicles under the Automated & Electric Vehicles Act 2018 …. However, rather than list all vehicles fitted with ALKS by default, individual models will be listed after they have received whole vehicle type approval (WVTA). This will enable the Secretary of State to review evidence that may have come to light before the formal decision as to whether to list the vehicle model is made.” (page 41)

and stated that:

“Since no automated vehicle will yet have been listed upon commencement of AEVA, we will not be publishing the list.” (page 43).

So, the government (the Secretary of State for Transport) expects that a vehicle with ALKS will, if when such a vehicle receives whole vehicle type approval (from the Vehicle Certification Agency), be listed as an automated vehicle.

So the AEV Act 2018 is both in force and not yet practically activated. The Secretary of State’s list of safe and lawful automated vehicles must be published when it is first prepared (AEV Act 2018 section 1(3)). The Secretary of State has said that he intends to classify a vehicle with ALKS as automated, though he will await type approval of such a vehicle before making that decision.

The publication of the list will put the first lawful automated vehicles onto British roads, activate Part 1 of the AEV Act 2018 in practical terms, and start a new age of road traffic law.

Future Regulation of Automated Vehicles

The AEV Act 2018 is essentially an insurance act. Liability and insurance questions are closely related in road traffic accident cases. Save for public bodies and the Crown permitted to use a vehicle without insurance, the Act applies only to insured automated vehicles, so does not (on its present terms) provide a remedy for a person injured by an uninsured automated vehicle. So, even on its own terms, the AEV Act 2018 does not answer all insurance questions which arise from AVs.

In its March 2021 response to the Law Commission’s third consultation paper on AV law, the Motor Insurers’ Bureau did not commit to putting measures in place to compensate people injured in accidents caused by uninsured AVs, writing that:

“Provisions for victims of uninsured AVs were not included in the Automated and Electric Vehicles Act 2018. At present, there are no Agreements in place between the MIB and the Secretary of State for Transport to deal with these claims. There are important questions to be addressed around the compensation of victims in specific circumstances – for instance, if critical software has not been updated – and how it should be funded. Should the ADSE [Automated Driving System Entity] contribute and if so, how should this be structured? The MIB would welcome a debate around these issues.” (page 6, answer to question 53)

Nor does the AEV Act 2018 write the laws of AV liability. The 2018 Act moves a small distance into some areas of liability law (for example, contributory negligence), but it treads lightly. It will be left to the courts to apply and expand the law of causation (among other laws) to the facts of particular AV cases.

The AEV Act 2018 does not deal at all with the many issues of criminal and public law that will arise from the use of AVs (including but not limited to use of data and cybersecurity, as well as the establishment of a safety regulator for AVs). The Law Commission has concluded its three-year consultation on reform of the law for AVs, and will publish its conclusions towards the end of this year. And so the journey continues.

Alex Glassbrook

Photo by Gordon Williams on Unsplash