Israel is a true hub for autonomous vehicles technology.  KPMG’s 2019 Autonomous Vehicles Readiness Index ranks Israel first out of twenty-five countries in AV technology and innovation, noting that the country has 500 to 600 automotive start-ups, with a fifth focused on AV.  But the same survey rates Israel a middling eighteenth out of twenty-five in AV policy and legislation.  This uncertain regulatory environment impedes local deployment of autonomous vehicles.

Other countries also wrestle with AV regulation.  For example, US regulation of autonomous vehicles remains nascent, dispersed and fragmented.  But the US benefits from having many states, which have emerged as important laboratories of democracy.  Since 2011, when Nevada became the first state to authorize the operation of autonomous vehicles, more than 30 states have enacted legislation or issued executive orders relating to autonomous vehicles. These states are experimenting with a wide range of approaches, some cautious and others more ambitious.

On the cautious end are statutes and executive orders merely authorizing further study. One example is a recent Minnesota executive order which measuredly establishes an advisory council “to study, assess, and prepare for the opportunities and challenges associated with the widespread adoption of connected and automated vehicles and other intelligent and emerging transportation technologies.” More substantive laws may eventually follow.

Other states have gone further, allowing testing of autonomous vehicles. New York allows testing, but only under the direct supervision of the New York State Police. This approach is perceived by some to be heavy-handed; for now, notably, relatively little testing is being done in New York, despite the strategic importance of that market.

Florida is among the states that have a lighter touch. Its legislature has expressly declared its intent to encourage autonomous technology and, in Florida, autonomous vehicles may be freely deployed, not just for testing purposes, but for any purpose. No special permits, licenses or approvals are needed. Florida has even gone so far as to eliminate the requirement that a human operator be present in the vehicle. Unsurprisingly, Florida is now a hotbed for autonomous vehicle activity.

A different way to attract industry interest may be to provide clear rules and regulatory certainty. California, another autonomous vehicle hub, sets out detailed regulations distinguishing among different types of testing and different types of deployment. Each type has its own permitting and other requirements. There is testing conducted with drivers versus testing conducted without drivers, and special programs for testing with passengers compared to testing without passengers. There also are rules differentiating between deployment of passenger vehicles versus deployment of trucks.

California has a relatively comprehensive framework compared to that of other states, providing clarity and certainty that may help engender consumer confidence. Getting all of this right is important because of the effects: safety, mobility, efficiency, productivity, economic growth and the environment. The best ideas (we hope) will percolate to the top.

Chung Wei is a partner in DLA’s Intellectual Property and Technology group and is based in Silicon Valley.  Chung Wei advises clients on business and technology-related transactions, such as software licenses, software as a service (SaaS) transactions, distribution agreements and contracts involving intellectual property.  Reach him at chung.wei@dlapiper.com.