The Automated Vehicles Act 2024 becomes law in the UK

On 20 May 2024 the UK passed the Automated Vehicles Act 2024 (“the Act”). With regulation widely seen as one of the primary hurdles to the adoption of self-driving vehicles, the Act marks a major step towards breaking down this barrier by creating a comprehensive legal framework for the safe deployment of self-driving vehicles in the UK. The legislation should help accelerate investment in the industry, which is forecasted to be worth £42 billion and create an estimated 38,000 new jobs in the UK by 2035.

The UK has already proved to be a supportive regulatory environment for self-driving vehicles, with the Act being the culmination of a 4-year review carried out by the Law Commission of England and Wales and the Scottish Law Commission. Alongside this, the UK implemented changes to the Highway Code and enabled trials through its Code of Practice. This has contributed to the emergence of industry leaders, such as Wayve, who recently raised $1.05 billion in its Series C funding round – one of the largest investments in UK AI history.

Many in the industry will already be familiar with the Act, particularly because they played an invaluable role during its consultation process. For those new to the area, the following aspects of the Act are particularly noteworthy:

• A new authorisation and licensing regime for self-driving vehicles.
• A new liability regime for Authorised Self-Driving Entities (“ASDE”) and No-User-in-Charge Operators (“NUIC”) and their relevant senior decision-makers.
• Marketing restrictions which prohibit the use of certain designated terms unless used in connection with an authorised automated vehicle. 

Below we have provided some further commentary on these changes

Authorising a self-driving vehicle

Under the Act, an automated vehicle will receive authorisation from the Secretary of State only if it satisfies certain criteria under the ‘self-driving test’. 

The key takeaway from the test is that to be ‘self-driving’, neither the vehicle nor its surroundings are being monitored by an individual with a view to them immediately intervening in driving the vehicle. This means that certain driver assistance features, such as ‘hands off, eyes on’ steering capability, should not satisfy the self-driving test and corporates will need to be careful not to mislead consumers regarding a vehicle’s capabilities. Further, as part of the self-driving test, the Secretary of State will assess the vehicle against a statement of safety principles (to be published at a later date) which, in short, must be framed with a view to ensuring that road safety in the UK will be better as a result of automated vehicles.

Liability for harm

Liability is often the main topic of debate when it comes to driverless vehicles and, to address this area, the Act provides clarity regarding the responsibilities of certain actors:

• ASDE: The entity that puts the vehicle forward for authorisation, known as the ASDE, takes general responsibility for the vehicle continuing to satisfy the self-driving test. The ASDE may be the manufacturer or developer (or a partnership between the two).
• User-in-Charge: Where an automated vehicle has an individual behind the wheel (the “User-in-Charge”), they will generally be immune from committing road traffic offences (subject to certain exceptions, such as using an automated vehicle in a dangerous state).
• NUIC Operator: Where an automated vehicle does not require a human in the driving seat, a licenced ‘No-User-in-Charge Operator’ will be required to ‘oversee’ that vehicle and respond to alerts from the vehicle if it encounters issues beyond its capacity to handle.
• Senior Decision-Makers: The Act also creates criminal offences for certain senior decision-makers of an ASDE or NUIC Operator, such as liability for misleading the regulator during the authorisation process.

For civil liability purposes, the Automated and Electric Vehicles Act 2018 still applies, meaning victims who suffer damage do not need to prove fault as the relevant insurer will compensate the victim directly. The insurer may then pursue recovery against, for instance, the ASDE under product liability law.

Misleading marketing

The Act also covers marketing. There are obvious safety consequences for consumers if they mistakenly believe a vehicle to be sufficiently autonomous and therefore do not monitor the road when they simply have a vehicle with a limited driver assistance feature. Corporates who mislead consumers already risk serious consequences, as evident this month in the US Department of Justice’s securities fraud investigation into Tesla for overstating its self-driving capabilities.

To prevent entities attempting to curtail the authorisation process, the legislation empowers the Secretary of State to prohibit the use of certain terms in describing a vehicle’s self-driving capabilities.

What’s next?

The Act should provide greater clarity for developers and comfort to those considering AV-related investments and transactions. Regarding the latter, whether you are raising capital, entering a strategic partnership, or thinking of an acquisition, the Act will help shape negotiations as parties seek to allocate risk and obtain the appropriate deal protections. The $1.05 billion investment into Wayve is a great vote of confidence in both the industry and the UK market and the reduced regulatory risk brought by the Act may result in an increase of transactional activity as corporates race towards commercial deployment at scale and monetising their technology. 

Finally, even with the general election fast approaching, we would expect the next government to use its powers under the Act to issue more detailed regulations over the coming year (particularly on authorisation, marketing, and the safety principles). We will be closely monitoring these developments.

Prior to joining Slaughter and May, Scott Cormack worked at the Law Commission as a research assistant on the automated vehicles project.