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New Zealand should be a testbed for AV technology, with public use focused on last-mile delivery, both for passenger transport and freight

The brave new world of driverless vehicles – By Chris Dann and Chantal Stewart

Are driverless cars going to become the new robots of the road? And if so, what happens when the robots err?

The April/May edition of FTD featured an interesting article by Nigel Parry on driverless delivery vehicles trundling along the footpaths in “a veritable rash of AV launches and trials over recent months”, such as the Amazon Scout AV (“an Esky on wheels”) and FedEx’s Sameday Bot.
Here in New Zealand, Kiwi startup Ohmio recently tested its snazzy-looking driverless shuttle at Auckland’s Wynyard Quarter Innovation Precinct following trials at Christchurch Airport, with the long-term goal of becoming a ‘first and last mile’ transportation method – ferrying people to and from airports or bus stations and around campuses. Pretty cool stuff – like a Johnny Cab from ‘Total Recall’! Will KITT be pulling up next to us at the lights soon?
That got us thinking – what are the legal issues involved?

No driver needed

There is nothing in New Zealand law that explicitly states a vehicle on a public road must have a driver. Internationally, that’s quite unusual. While other countries grapple with specific testing laws for autonomous vehicles (AVs), New Zealand is relatively free of existing regulatory impediments to testing. 

Vehicles must simply meet (or be exempted from) existing approved vehicle standards and be operated safely. It is an offence under New Zealand’s Land Transport Act to drive or cause a motor vehicle to be driven recklessly or in a way that is dangerous to the public.
New Zealand’s first 5G-connected driverless car is being tested on Auckland streets, as a result of a collaboration between Spark New Zealand and Ohmio

Indeed, the Ministry of Transport has had an AV testing process in place for a number of years which is starting to bear fruit. As well as Ohmio (mentioned above), NZMobility Lab, a scheme led by the New Zealand Transport Agency, with involvement from the Christchurch City Council, Ministry of Business, Innovation and Employment, Civil Aviation Authority and University of Canterbury, is close to finalising a five-year lease for autonomous vehicle testing by private companies on 34 ha of Christchurch’s abandoned red zone land. And in the skies above Canterbury, aviation company Zephyr Airworks is already testing Cora – a ‘pilotless air taxi’ – and has ambitions to transport human passengers within the next five years.

Open-door policy

Our permissive approach to AV testing is indicative of the government’s policy to encourage the testing and adoption of future-focused technologies in New Zealand, particularly in the transport sector, in order to unlock the $1.5 billion per annum which Deloitte has estimated intelligent transport systems could contribute to the New Zealand economy.

The government’s open-door and agile approach (as well as our laws not requiring a driver) has us ranked third in the world by KPMG for policy and legislation in its recently released 2019 Autonomous Vehicle Readiness Index. However, we struggle to compete in the Technology & Innovation and Infrastructure categories (16th and 17th respectively), falling to 11th overall (down from 9th last year). 

The report comments that our physical isolation, low population density and our patchy mobile network coverage means AV implementation on New Zealand public roads is likely to be slow and expensive.

We agree. We see New Zealand being a testbed for AV technology, but we think public use – when the testing is done – will be focused on last-mile delivery, both in a passenger transport context (like Ohmio) and in a freight context (such as the delivery drones mentioned above). Deutsche Bank estimates that drones and robots could reduce the cost of last-mile delivery by 80%.

The law without a driver

Despite our laws not requiring a driver, they are written in a way which assumes a driver is present, and will need revisiting to properly regulate for public use of autonomous vehicles. 
For instance, driverless vehicles can speed and drive on footpaths with impunity. The relevant sections of the Land Transport (Road User) Rule say: 

  • • ‘A driver must not drive a vehicle at a speed exceeding the applicable speed limit’
  • • ‘A driver must not drive a motor vehicle along a footpath.’
On the other hand, any driverless vehicle (including the ‘Esky on wheels’ delivery bots being developed by Amazon, FedEx and others) will clearly be a ‘motor vehicle’ under current definitions: ‘a contrivance equipped with wheels, tracks, or revolving runners on which it moves or is moved’ (including, oddly, a hovercraft, but not a perambulator or pushchair) and which is ‘drawn or propelled by mechanical power’.


The absence of a driver is also relevant in a liability context. Without a driver, who is liable if an autonomous vehicle crashes? Most commentators say the manufacturer because of a defect in the technology. But different parts of an AV might be manufactured by different parties, and the user might be partly culpable. 

The UK has taken a different approach by passing legislation in July last year meaning that insurers will be liable for damage caused by AVs when in self-driving mode. That approach keeps compensation within the motor insurance settlement framework, rather than a product liability framework. 

Flashback to the 1980s – KITT, the talking, driverless Pontiac Trans Am of Knight Rider fame

Importantly, in New Zealand the liability issue is limited to property damage. New Zealand’s Accident Compensation Corporation regime means no one can be held liable for personal injury or death (another reason why New Zealand is an attractive destination for AV testing).

The Ministry of Transport has a work programme to clarify the current legal situation that applies to the deployment of AVs in New Zealand. However, the current focus is on testing, rather than liability for general use. 

The government’s Intelligent Transport Systems Technology Action Plan says: ‘Internationally there is a great deal of thought being given to what laws will be necessary for the general operation of driverless vehicles. Their widespread operation will pose complex legal challenges, especially to determine liability in the event of any accident. It is not proposed that the New Zealand government will explicitly look at these legal issues at this time. Rather, the government will continue to monitor international developments and draw on this knowledge once international thinking has developed further, and it is clearer if or when these vehicles will be commercially available.’


While liability questions and the oft-stated ‘ethical dilemma’ (programming the algorithm to choose between two evils, such as running over pedestrians or sacrificing itself and its passenger to save them) are difficult and headline-grabbing issues, there is a risk of overthinking these issues and consequent regulatory overreaction. 

The same ‘ethical dilemma’ can be faced by human drivers now, yet an AV can respond to that situation six times faster and thereby significantly reduce the likelihood of injury to both the pedestrian and the passenger.

According to the World Health Organisation, there are 1.34 million road deaths every year globally. Some 90% of New Zealand’s road deaths are caused by human error. For each life lost, the social cost is estimated to be $4.09 million, according to the Ministry of Transport’s annual social cost of road crashes and injuries report. Removing human-error risk by moving to AVs should therefore deliver an enormous reduction in vehicle-related deaths.

Privacy and data protection

Privacy and data protection rules and standards will also need careful consideration and updating for the AV world. 

Precise location tracking is key for AVs, as is communicating with each other and with other infrastructure – which means speaking the same language. Do we need to take a leaf out of the mobile phone market and adopt standardised technology to ensure that vehicles can communicate seamlessly with each other and with the external environment?

Driverless vehicles will generate a wealth of information, including route history, the vehicle’s actions, and personal information and preferences. Which of this information should be able to be shared, and with whom? Should the police be able to use that data? What about using the data for taxation, transport planning or even commercial uses?
A recent report from the International Transport Forum highlighted the vulnerabilities of AVs to cyber-security risks and recommended designing such vehicles so that safety-critical systems are functionally independent and cannot fail in case of connectivity issues. The report also recommended that AVs should be required to report safety-relevant data and the establishment of comprehensive cyber-security principals.

What next?

The pace of development is the problem for policy-makers and regulators. That is why the New Zealand government is taking a ‘wait and see’ approach, aiming to be an early adopter rather than a leader in AV-specific laws.
However, our existing laws – perhaps by accident rather than by design – need tweaks rather than a complete overhaul, unlike other countries. And we have a supportive government, very keen for future-focused technologies to be developed here. 

A world of dodging delivery robots (as well as Lime scooters) as you cross the footpath to wait for your electric, driverless shuttle to the airport, is perhaps just around the corner.

Chris Dann heads the transport and logistics team of law firm Anthony Harper and was assisted with this article by Chantal Stewart; the team is one of the few in New Zealand with strength and experience along all facets of the supply chain; for further information, visit www.anthonyharper.co.nz

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