The proposed reforms, which form part of broader measures to provide a more coherent regulatory framework for New Zealand's growing drone industry, would clarify drone operators' responsibilities, as well as creating new consequences for misuse.
Drones have the potential to make fundamental changes to how New Zealanders do business and transport goods. Government research indicates that the benefit to the economy of using drones could be between $4.6 billion and $7.9 billion over 25 years, with potential productivity gains across a wide range of sectors. The various use cases include agriculture (e.g. monitoring livestock and crops), utilities (e.g. inspecting power lines), and public safety (search and rescue, fire, etc.) and many others besides. Any business which relies on fast and efficient delivery, logistics, or monitoring systems, is likely to have an interest in the Bill.
This update provides an overview of the current framework, as well as the key changes currently proposed under the Bill.
What are the current rules?
Since 2015, New Zealand has had a two-tiered, risk-based regulatory regime for drone operations under the Civil Aviation Rules (Rules). In contrast to many other countries, including the USA and Australia, there is no distinction between commercial and recreational operations. Instead the Rules focus on the safety risks of an operation, rather than its purpose.
Low-risk drone operations are governed by Part 101 of the Rules and do not require formal approval. A short list of prescriptive rules apply, including that operators must only fly drones:
- during the day,
- below 120 metres,
- no less than 4 km from an aerodrome,
- within the operator's line of sight, and
- with prior permission (where flying over a person, private property or in controlled airspace).
Higher risk operations outside these parameters are governed by Part 102 of the Rules, which require an Operator Certificate issued by the Civil Aviation Authority (CAA). In addition, drones of 25 kilograms or more require CAA approval even if operating within the Part 101 Rules. To obtain a certificate, operators must demonstrate that they are trained and that the drone can be safely operated, and must pass a “fit and proper person" test. There are currently 125 certified Part 102 drone operators.
The Civil Aviation (Offences) Regulations 2006 prescribe various penalties for breaches of the Rules, ranging up to $5,000 for an individual, or $30,000 for a body corporate. In addition, the Civil Aviation Act 1990 prohibits dangerous activity involving “aircraft" (which is defined broadly, and captures drones). Such activity can result in imprisonment of up to 12 months or fines of up to $10,000 for an individual, or $100,000 for a business. A high-profile example of a recent conviction under the Act involved a mid-air collision between a drone and a paraglider on Karioitahi Beach.1
Changes under the Bill
The current framework, though relatively permissive compared with overseas regimes, was not designed to address the growing range of potential uses for drones. In its July 2019 paper “Taking Flight: An aviation system for the automated age", the Government noted that “long-term, Part 102 is not currently well-suited to certify a large, passenger carrying operation similar to traditional aircraft certified under Part 121. Similarly, there is likely to be a need to review airspace classifications, particularly in the very low levels, should goods delivery by smaller drones become commonplace." An exposure draft of the Bill was issued in 2019, followed by an initial consultation process with industry participants.
There are three key changes under the Bill relevant to the integration of drones into the wider framework of the Civil Aviation Act:
- “Pilots" - The definition of “pilot-in-command" is expanded to include: “in the absence of a pilot on board the aircraft… the person who the rules specify as responsible for the operation and safety of the aircraft in accordance with the rules." This will mean that the duties applicable to manned aircraft pilots (including responsibility for the safe operation of the aircraft and the safety of passengers and cargo) will apply also to drone operators.
- “Accidents" - The definition of “accident" (currently defined by reference to the period between boarding and disembarking the aircraft) is expanded to cover “aircraft intended to be flown without any person on board." The definition will include accidents occurring between the time the drone is “ready to move with the purpose of flight" and the time it comes to rest and the primary propulsion system is shut down. This will mean that the obligations arising following an accident, including notifying the CAA, will also apply to accidents involving a drone.
- Seizure - The Bill creates new powers for various specified authorities to seize, detain, or destroy a drone where it is being misused in a dangerous or illegal manner. This is intended to bolster the current enforcement framework, and to address concerns about dangerous misuse of recreational drones (including various recent “near misses" with passenger planes and helicopters).
The above amendments are relatively mechanical but are proposed in parallel with other Government efforts to develop a national drone ecosystem, including updating the current Rules to make them clearer and more relevant to potential future uses of drones, the introduction of a new basic drone pilot qualification, and a new centralised drone register to identify drones and their owners.
In addition to the above, the Bill significantly increases the penalties for dangerous activity involving aircraft (including drones). Such activity would now be subject to a fine of up to $150,000 for an individual, or $1.5 million for businesses. If the activity is reckless, those penalties increase further: individuals face imprisonment of up to 5 years or fines of up to $300,000, with potential fines for businesses of up to $3 million.
Next steps
We will monitor the Bill as it moves through Parliament and will continue to provide updates on its progress and the opportunity to make submissions.
If you would like to discuss the implications of the Bill, please do not hesitate to get in touch with the contacts listed or your usual Bell Gully adviser.
1 Civil Aviation Authority v Pitman [2021] NZDC 3157; Pitman v CAA [2021] NZHC 1507.
Disclaimer: This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.