Update: Automated and Electric Vehicles Act 2018

As foreshadowed in the RPC Retail Compass (available here), last month the Automated and Electric Vehicles Act 2018 (AEV Act) came into force. This is a welcome step in the process of updating UK law to ensure it applies to the evolving landscape of connected and automated vehicles (CAVs). It also makes provision to further the use of electric vehicles (EVs).

The AEV Act addresses two key areas:

• modernisation of insurance rules in relation to liability for accidents; and

• improvement of electric charging infrastructure in the UK.

Both of these areas have relevance to the retail sector, which has embraced the use of automated technology in various forms, for example, Ocado's trials of driverless delivery vans and Just Eat's automated delivery bots. Closely aligned with this is a need to facilitate and expand consumer use of EVs as these become more mainstream. 

Liability for accidents

While the cost savings from automated logistics could be significant, prior to the AEV Act, liability for accidents caused by CAVs was unclear because motor insurance in the UK is taken out on the driver, not the vehicle.  This left a question mark over the insurance position of CAVs, which do not have a human driver. The AEV Act seeks to plug this gap by confirming that where an insurance policy is in place, in most cases it will apply when a vehicle is in control of itself. However, this will only apply to accidents caused by CAVs when driving themselves on a road or other public place in Great Britain (not Northern Ireland).

As expected, the AEV Act confirms that contributory negligence remains highly relevant where injured parties/those involved in an accident with a CAV have taken risks or made errors which caused or otherwise contributed to the accident.

Finally, the AEV Act clarifies that insurers may exclude liability if the software operating a CAV has been altered without authorisation and/or if necessary software updates were not installed. In such circumstances, an accident must have been either:

• a direct result of such software alterations; or

• caused by a failure to install safety-critical software updates that the insured party knew, or ought reasonably to have known, were safety-critical.

In a retail context, the above highlights the need to have proper visibility and/or control of CAV maintenance records and updates. Appropriate systems must be put in place to ensure software cannot be overridden or tampered with by drivers, operatives or third parties. The AEV Act does not address cyber-security which will likely be a further risk factor in this context. Further legislation is expected to deal with this in due course.

Electric Charging points

The AEV Act's second focus is on making electric charging points more prevalent by creating a charging infrastructure network within the UK. The Government now has powers to force certain retailers to install EV charging points, for example, in large fuel stations and motorway service stations and also to ensure that these points are 'smart', i.e. they allow for functionality, information and payment to be offered at one point (including options for remote payment). 

In addition, EV charging points must allow energy monitoring and interact with the National Grid to help manage the increased demand for electricity that mainstream EV use will require once the technology becomes more widely adopted.

Comment

The AEV Act helps to move matters forward in these two important areas of relevance to retailers. Firstly, it is important to ensure appropriate insurance cover is taken out for use of CAVs for business purposes. Secondly, there is continued pressure on everyone, including retailers, to take steps to reduce environmental impacts brought about by vehicle use and make it easier for consumers to do the same.

The UK Government continues to engage with a wide range of stakeholders, including vehicle manufacturers and the insurance industry to ensure that the law keeps up as the technology and infrastructure for CAVs and EVs continues to develop.