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19 Aug 2022

Relationship with the EU

With recent changes to the Highway Code coming into effect shortly, the first wave of self-driving vehicles  in the form of cars fitted with Automated Lane Keeping Systems (ALKS) are set to take to Britain’s roads. 

Technologies like autonomous vehicles (AVs) have been seen by some as one area where Britain can enjoy greater flexibility to do its own thing after Brexit.   

The 2019 Conservative Manifesto promised that ‘our departure from the European Union means we can develop forward looking regulations to ensure we are first in line to develop and benefit from the technologies of the future.’ That theme was picked up again, with specific reference to autonomous vehicles, in the 2021 ‘Plan for Growth’. 

There are great expectations about what AVs could contribute to road safety, mobility, and the economy. One report estimated that switching to such vehicles could create benefits worth as much as £51bn and generate 25,000 jobs directly in vehicle production (and up to 320,000 jobs due to the wider impacts) by 2030.   

With the right regulations in place, the government hopes that consumers will benefit from safer and more efficient journeys. And more broadly it’s hoped that the UK will remain a leader in terms of deploying self-driving technology. Just today, the government laid out a plan to see self-driving vehicles rolled out by 2025.  

The UK has been active in this space for some time, including while it was still in the EU. For example, in 2015 the government introduced a Code of Practice on AV testing. It also set up the Centre for Connected and Autonomous Vehicles, which coordinates policy, engages stakeholders and manages research funding for supporting AVs.   

By July 2018, the Automated and Electric Vehicles Act became law in the UK, extending mandatory insurance to AVs, the hope being that such changes could speed up AV testing. A further review of the legal framework was published in 2020, and the government expects to have a full set of laws regulatory framework in place to support the widespread deployment of AV technology by 2025, ‘when parliamentary time allows. 

While the UK hopes that enabling ALKS on UK roads will assist in the development of AV technologies in the UK, this was (and is) anyway possible within the EU. The United Nations Economic Commission for Europe (UNECE) has been working on AVs and connected vehicles to harmonise technical AV requirements, and approved ALKS, which have most recently been extended to trucks, buses and coaches. 

Although the EU Commission adopted a strategy paper in 2018 on autonomous vehicles, there was no common EU legal framework in this area until this year. A Commission committee only set out guidelines on the exemption procedure for EU approval of AVs, aiming to harmonise member state practice on national ad hoc assessment of AVs and to streamline mutual recognition. 

This meant that new AV technologies not foreseen by EU rules could be provisionally approved by individual member states for use within their own territories, provided EU guidelines were followed, and it was up to each member state to decide how it regulated issues such as insurance. 

Given all this, Britain’s membership of the EU wasn’t a hurdle to it developing its own AV strategy: even before Brexit, the UK could create its own regulations related to AVs, given that there wasn’t much EU-level regulation of this area.  

That is changing however, as – like the UK the EU wants to be at the forefront of AV testing and development. Its new Vehicle General Safety Regulation came into effect this summer and empowers the Commission to complete the EU’s legal framework for AVs. Technical rules for the approval of fully driverless vehicles are imminent, and in some regards are set to go further than those in the UK, covering AVs replacing drivers on motorways (so-called level 3 automation) and fully driverless vehicles like urban shuttles or robotaxis (level 4 automation).   

These will cover testing procedures, cybersecurity requirements, data recording rules as well as the monitoring of safety performance and incident reporting requirements by manufacturers of fully driverless vehicles. 

Hence, while the UK does have regulatory autonomy from the EU after Brexit, so far it has not chosen to push ahead more quickly or do anything very different from what is happening in the EU. 

That’s not surprising as it is hard to imagine any notable future divergence in technical and safety rules. The UK and EU are both members of the World Forum for Harmonization of Vehicle Regulations, which sets vehicles technical and safety standards. And the UK-EU Trade and Cooperation Agreement obliges both sides to continue implementing World Forum rules.  

Where we could see more divergence on AVs is in relation to data protection, where strong regulation at the EU level does exist, and where the UK can now set its own rules. For example, maybe allowing companies easier access to personal data gathered by AVs could help them develop their autonomous driving systems more rapidly, and that, if the UK loosens data protection rules compared to the EU, car companies might find this attractive. 

However, many firms, including in the automotive sector, rely on being able to receive personal data from entities in the EU. While the EU Commission adopted an adequacy decision allowing data exchange with the UK, this is up for review in 2025. In essence, the government would need to weigh the benefits of divergence against the risk of the EU terminating adequacy. 

Furthermore, any cars sold in the EU have to conform to all EU rules, including those related to data protection. The fact that the UK car industry exports most of its output, with the EU as its biggest single market, would further limit the possible benefits of regulatory divergence. 

By Professor David Bailey, Senior Fellow, UK in a Changing Europe.

For more on where and how the UK has diverged from EU regulations, see the latest UK in a Changing Europe regulatory divergence tracker. 

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