Legal Regime for Self-driving Cars at Crossroads – Legislative Directions and Outlook of Self-driving Cars in Taiwan (Taiwan)

Sean Tsou

1. Backgrounds

Self-driving cars (unmanned cars), as part of the AI development domain, have been quite popular in recent years.  Global technology enterprises have rushed to research and develop relevant technologies for private cars or means of public transportation.  Various countries also have started to explore and formulate laws and regulations that accommodate the emergence of self-driving cars.  The regulation of self-driving cars is primarily originated from the adoption of the amendments to the Convention on Road Traffic, which allows self-driving technologies to be applied to transportation, by the United Nations in 2016.  Currently, countries like Germany and Singapore have amended their laws to allow self-driving cars to operate on roads under specific conditions.  Some states in the U.S. have also released laws and regulations which allow the testing of self-driving cars, while federal laws and regulations are also being deliberated by the Senate.

In Taiwan, draft laws and regulations relating to self-driving cars started to emerge in 2017, beginning with the draft Administrative Statute for the Testing of Self-driving Cars jointly proposed by lawmakers in October.  In November, the Ministry of Science and Technology also released the draft Statute for Technologically Innovative Experiments on Unmanned Vehicles.  In addition, the Ministry of Transportation and Communications also stated to the public that it is currently preparing the Guidelines for the Application of Road Test Operation for Self-driving Cars.  However, has the release of such draft laws and regulations truly addressed the needs for Taiwan’s development of self-driving cars and allayed public misgivings about self-driving cars on the road?

2. Brief analysis of the current draft legislation for self-driving cars in Taiwan

Terms such as “tests” and “experiments” in the draft Administrative Statute for the Testing of Self-driving Cars (hereinafter, the “Draft Testing Statute”) and the draft Statute for Technologically Innovative Experiments on Unmanned Vehicles (hereinafter, the “Draft Experimentation Statute”), which have been formally released, suggest that the legislative objectives of both drafts seek to prioritize the deregulation on on-road testing of self-driving cars in Taiwan.  In addition, the similarities and differences between the two drafts can be further compared in the following aspects:

(1) Definition of self-driving

The definition of self-driving cars in the Draft Testing Statute primarily references the classification standard for the automation level of self-driving cars set by the National Highway Traffic Safety Administration (NHTSA) and the Society of Automotive Engineers (SAE) in the U.S.   Simply put, the provisions of the Draft Testing Statute may apply as long as the operation and control of cars are intervened by an artificial intelligence driving system.  In the Draft Experimentation Statute, since it regulates “unmanned vehicles,” unmanned ships and aircraft in addition to self-driving cars also fall within the scope of such law.  Therefore, the draft defines unmanned vehicles by the technology applied.  A transportation vehicle can be regarded as an unmanned vehicle under such law only when it has sensing, positioning, monitoring, decision-making and control technologies.

(2) Application requirements for road permits

Since the Highway Act and Road Traffic Management and Penalty Law, which currently regulate the on-road operation of motor vehicles in Taiwan, as well as their relevant laws and regulations, all require the drivers to assume full responsibility for operating vehicles, self-driving cars, which allow an automatic driving system to control and operate the cars, are subject to strict restrictions in terms of safety tests and examination of cars and the acquisition of license plates.  Therefore, providing self-driving cars with opportunities for their on-road operation is imperative to the legislation for self-driving cars in Taiwan.

Since the concurrent operation of self-driving cars and conventional cars on roads has great implications, the two drafts both have strict procedural requirements for the application of road permits for self-driving cars.  The Draft Testing Statute requires that the owner of a self-driving car shall be the applicant of on-road tests with the test period and test roads specified to the competent authority at the time of application (such period is basically limited to six months and may be extended for six months, if necessary).  In addition to the description of the self-driving technology and the safety control plan adopted for testing, which shall be submitted by the applicant, there shall be proof of qualifications of the on-board testing personnel, and the applicant shall submit a proof of insurance and pay a security.  In comparison, the Draft Experimentation Statute requires that before on-road experiments are conducted, the experiment applicant shall file an application and an innovative experiment plan with the competent authority for transportation first.  In particular, the innovative experiment plan shall specify the scope, duration, number of experimenters and budget of the experiments, and documents such as proof of safety for the experiments, the agreement between and among the experiment participants and an insurance plan shall be attached.

(3) Progression of testing and application of subsequent data

The key to the actual testing certainly lies in the assurance of safety and collection of data.   The Draft Testing Statute provides that in the event of an accident during the test period, the applicant is required to file an accident report with the competent authority in seven days.  Within one month after the test is over, the applicant of the experiments is even required to submit the test records to the competent authority for use via the custody and release mechanisms set up by the competent authority.  In comparison, the Draft Experimentation Statute not only provides that the applicant shall release information such as the contents, duration and scope of the experiments in the website of the competent authority but also specifically stipulates that the competent authority shall set up management mechanisms for the safety information of innovative experiments so that applicants may submit relevant data electronically.  In addition, an applicant is compelled to report the frequency and reasons for human intervention in the control of an unmanned vehicle during the period of experiments.  In addition, the law also contains requirements for handling accidents.  To wit, in the event of an accident, the applicant shall immediately halt the experiment and investigate.  If the competent authority believes that continued experiments are risky, such experiments may be suspended.

As for the application of relevant data after tests are completed, the Draft Testing Statute only requires the competent authority to create the custody and release mechanisms for test data as mentioned above and does not have any further specific guidance and planning in legal provisions.  Conversely, the Draft Experimentation Statute mentions that after tests are completed, the competent authority shall reference the implementation of the experiments and encourage the innovation and development of unmanned vehicles through review and revision of relevant laws and regulations and provision of resources and assistance such as application services, technologies and business model improvements.

(4) Attributability and immunity mechanisms

Although accident liability is indeed the legal issue that the general public is most concerned about when it comes to unmanned vehicles, nether of the two drafts has enough coverage of this issue.  For starter, the Draft Testing Statute only specifically provides that the owner of a self-driving car shall be the individual penalized for any violation under the Highway Road and Road Traffic Management and Penalty Law but fails to clarify the party liable for the other legal liabilities.  In comparison, the Draft Experimentation Statute generally and abstractly provides that if any legal requirement is violated, the party to be penalized shall be the applicant.  However, what is more special is the draft’s express stipulation that the competent may exclude the application of laws and regulations – including the Highway Law, the Highway Road and Road Traffic Management and Penalty Law, the Ships Law and the Civil Aviation Law – in whole or in part.  This shows that the legal liabilities addressed under the two drafts are primarily limited to administrative law and do not include civil damage liabilities and potential criminal liability arising from accidents.

3. Lessons from overseas legislation

In May 2017, Germany was the first country in the world to adopt amendments to national laws and regulations for self-driving cars by completing the amendments to its existing Straßenverkehrsgesetz (Road Traffic Law), in which new requirements for automatic driving are incorporated.  In September 2017, the draft Safely Ensuring Lives Future Deployment and Research In Vehicle Evolution Act (the “SelfDrive” Act) was also adopted by the House of Representatives and formally placed under the deliberation of the Senate.  To provide references for lawmakers in Taiwan, the highlights of the Road Traffic Law as amended in Germany and the draft Self Drive Act in the U.S. are briefly introduced below.

(1) Road Traffic Law in Germany

The Road Traffic Law in Germany is focused on introducing an automatic driving system to facilitate the control of cars.  This means that although cars on roads may be equipped with automatic driving functions, a driver’s monitoring and control of the automatic driving system is basically still required in the entire process.  When a self-driving system requires the driver to take over or the driver is aware that the self-driving system can no longer function normally, the driver is obligated to immediately take over the control of the car.  Strictly speaking, the imaginary state of “unmanned vehicles” is not yet achieved.

In addition, the law specifically requires that a pilot data recorder (similar to a “black box” for aircraft) shall be installed in a self-driving car to record information showing the control of the car by the driver or the self-driving system at different points in time during the operation of the car.  In particular, when a self-driving system experiences technical difficulties or when the system requires the driver to take over and control the car, the recorder shall also generate relevant data and records for future improvement and reference.  As for accident liabilities, although the amendments raise the ceiling of damages payable to a victim to 10 million Euros, still there is no new planning with respect to the attribution of liabilities after an accident occurs.  However, it is imaginable that with a pilot data recorder, the contents of such data recorder will serve as an important reference in the pursuit of accident liabilities.  To wit, if the data show that the driver was driving the car at the time of the accident, the driver shall assume more liabilities.  Conversely, if the self-driving system was controlling the car, the car manufacturer shall assume more accident liabilities.

(2) Self Drive Act in the U.S.

The draft Self Drive Act in the U.S. adopts a principle-based legislative approach.  To wit, a principle-based basic framework was first created for the regulation of unmanned vehicles before relevant authorities were required to prescribe detailed regulations to address inadequacies within a period of time after the act was approved.  In the draft submitted to the Senate for deliberation, the most important breakthrough is the specific requirement that the current automobile safety standards are no longer relied on to examine self-driving cars (e.g., the requirement that a car shall have essential tools for manual operation and control of the car such as the driving wheel and brake pedal).  Instead, the competent authority was required to prescribe new examination standards in two years after this act is adopted and to review its revision every five years.  However, with the exception of the safety review standard, which is still left on the federal level, the bill delegates matters such as the registration, issuance of license, insurance and accident liabilities concerning self-driving cars to be regulated by states through their own legislation.

In addition, the current bill is even expected to exercise quota control over the number of self-driving cars.  In the beginning, the deregulation of 25,000 cars is initially planned with the quota gradually expanded to 100,000 three years later.  In addition, since a self-driving car is completely controlled by a computer system, the Self Drive Act also stresses the requirements for information security by requiring operators to set a written information security policy and monitor the access of system information.  Meanwhile, this act also requires operators to disclose the manners in which personal data about users of self-driving cars are gathered and processed to echo the increasingly important requirements for privacy protection in the digital era.

4. Legislative outlook for self-driving cars in Taiwan

In view of the legislation for self-driving cars at home and abroad, what is actually involved is nothing more than the examination of cars, driving on roads and attribution of accident liabilities.  Take the two drafts in Taiwan for example.  They are primarily focused on accelerated deregulation of roadworthiness tests of self-driving cars.  The prioritized legislative objective is on-road testing of self-driving cars.  Although the phase of accumulating massive on-road driving data to facilitate the development is correct, still a more important issue is how to ensure effective utilization of data obtained from on-road operation of self-driving cars.  In particular, applying for an experimental site in which testing is performed is one thing, while incorporation of such testing into public road networks is quite another.  How to select a scope of roads for testing in order to obtain information of referential value and how to effectively maintain and properly disclose data collected from all experiments without undermining privacy and trade secrets still require more refined regulation.

From the perspective of safety examination, since technological advancements are involved, it is indeed necessary to bring standards into line with the current needs.  However, the extent of safety which should be expected may still require evaluation by experts and lawmakers.  In this regard, matters that may be legally regulated primarily pertain to the scope of required examination items.  In addition to considerations such as relaxing the requirements for essential equipment of conventional automobiles (such as driving wheels and pedals) to accommodate the characteristics of self-driving cars, the inclusion of the extent of information security in the examination standard should be an option worthy of contemplation in view of the great importance of information security protection to a self-driving system that utilizes digital communications technologies.

As for the issue concerning the attribution of accident liabilities, which the public are most concerned about, the attribution of the compensation liabilities should be mainly defined by the tort liability of a driver and the product liability of car makers under current laws as the fallback in the absence of handling mechanisms specially added under laws and regulations.   However, under the circumstances where a car is jointly controlled by the driver and the self-driving system, how can the causal relationship be effectively established and whether the degree of the driver’s subjective care can be reduced both warrant further discussions.  In fact, the key lies in the determination of who is controlling the car at the time of the accident.  When self-driving cars mostly have pilot data recorders today, it is imaginable that the reading of such data to clarify liabilities will serve as an important reference and standard for attributing liabilities.  However, there has been certain news recently about drivers protesting against car makers’ interpretation of accident data mostly in their own favor.  Under such circumstances where car makers are “players and referees at the same time” with hardly convincing results to relevant parties, it should be necessary in the future to make detailed regulations concerning the disclosure and reading of necessary data and records or is even preferable to train a fair third party to serve as a professional examiner.  In addition, although it is not unreasonable to impose a higher obligation of care on the driver of a self-driving car at the current development stage, still if drivers are supposed to assume joint liabilities, car makers should also do their part in fulfilling their educational and instructional obligation as a reasonable precondition for passing the liabilities.

Thanks to its advanced manufacturing technologies and supply chains for automobile electronics and equipment, Taiwan in fact enjoys advantages in the development of self-driving cars as a sector.  With the current release of relevant draft laws and regulations, the promoters have chanted slogans to seek regulatory breakthroughs so that laws and regulations can help move the self-driving car industry in Taiwan forward.  However, although there have been legislative movements, the adoption of the legislation is still nowhere in sight.  Before this essay was completed, the Ministry of Science and Technology also announced that a new version of the draft Statute for Unmanned Driving Experiments would be released.  Although the text is still not available, it can be inferred from relevant news releases that the draft will be entangled in how to allow roadworthiness testing without any further progress.  When we are bogged down in this legislative quagmire in Taiwan, other countries are still moving forward.  How to make progress and move forward is perhaps the very issue that concerns all of the people standing at the crossroads of self-driving car development.