California Finalizes Regulations for Autonomous Vehicles, Including Testing, Deployment, Privacy, and Truth-in-Advertising Requirements

On February 26, 2018, the California Office of Administrative Law approved new regulations proposed by the Department of Motor Vehicles (DMV) that will allow the testing and deployment of autonomous vehicles (AVs) on California public roads. These regulations establish new types of permits that the DMV can issue to manufacturers that would allow them to test driverless vehicles and to deploy them for public use. The DMV can start approving applications for these new permits starting April 2, 2018.

The new regulations allow for the first time deployment of AVs on public roads in California. Previous regulations limited AVs to testing purposes, and only with a human driver at the wheel. The new regulations allow companies to put AVs to new uses, though they do not provide for the testing or deployment of certain types of vehicles—such as heavy trucks over 10,000 pounds or autonomous motorcycles.

Companies that want to test or deploy AVs (as defined under the regulations) on public roads must apply for and obtain a permit from the DMV. The new regulations create three types of permits: (1) Manufacturer’s Testing Permit; (2) Manufacturer’s Testing Permit – Driverless Vehicles; and (3) Permit to Deploy Autonomous Vehicles on Public Streets. To obtain a permit, companies must meet liability insurance requirements (with an option to self-insure), submit documentation to the DMV, and comply with reporting provisions, among other requirements. Companies must comply with additional requirements to test or deploy driverless vehicles—such as vehicles that have no steering wheel or manual controls.

The DMV’s final regulations also create truth-in-advertising rules that prohibit manufacturers from advertising vehicles as “autonomous” unless they meet the definition of “autonomous vehicle” under the regulations and the manufacturer is licensed and permitted under California’s vehicle code and regulations. The regulations proscribe, for example, advertising that would “likely induce a reasonable person” to believe a vehicle is “autonomous” when it is not.

The regulations also add protections related to information privacy, including the collection and use of personal information. For example, the regulations create certain requirements for manufacturers to disclose to drivers (or passengers as applicable) what personal information will be collected and how it will be used, or to anonymize information—particularly information that is “not necessary for the safe operation of the vehicle.”

Some other salient features of the final regulations are described in more detail below. The full text of the final regulations is available here. O’Melveny continues to monitor developments in autonomous vehicle law to advise its clients regarding requirements.

Testing of Driverless Vehicles

In addition to already-existing testing permit for AVs (which allow testing for vehicles where a human test driver is present in the vehicle at all times), the new regulations provide for a testing permit of driverless cars that lack any manual controls. To qualify for this type of permit, however, companies must certify compliance with dozens of requirements, including:

• Local Authorities — A company must notify local authorities—before it applies for a permit—of the parameters of its future testing, including (1) the operational design domain of the test vehicles, (2) the roads on which the AVs will be tested, (3) the times and days of that testing, and (4) the numbers and types of test vehicles.
• Vehicle Design — A company must certify that its vehicles have particular characteristics, including a communication link between the AV and a remote operator who can monitor the vehicle’s status.
• Law Enforcement Interaction Plan — A company must provide a copy of a “law enforcement interaction plan,” which provides information to law enforcement agencies about how to interact with the vehicle in emergency and traffic enforcement situations.
• Training Program — A company must maintain a training program for remote operators and certify that each remote operator has completed that training.

Deployment of AVs

The new regulations also pave the way for deployment of AVs in California—so long as the manufacturers of those AVs obtain permits from the state DMV. The requirements to obtain these permits include insurance requirements similar to those needed to obtain a testing permit. Permit-seekers are also required to submit law enforcement interaction plans and consumer education plans. And they are required to make various disclosures and certifications to the DMV, including:

• A description of how the vehicles meet SAE International’s definitions of Level 3, 4, or 5 driving automation systems;
• A description of the vehicles’ operational design domain, and how the vehicles are designed to react outside that domain;
• A certification that the vehicles comply with all Federal Motor Vehicle Safety Standards, or are exempted from compliance;
• A certification that the vehicles’ autonomous technology is capable of compliance with California traffic laws;
• A certification that the AVs meet current industry standards for cybersecurity.

Under the new regulations, AVs can be lawfully deployed in California only if they meet various design and performance requirements. For instance, vehicles must be equipped with data recorders that store information about the autonomous technology’s performance, and they must be designed so that they will safely come to a complete stop if the AV technology fails.

This memorandum is a summary for general information and discussion only and may be considered an advertisement for certain purposes. It is not a full analysis of the matters presented, may not be relied upon as legal advice, and does not purport to represent the views of our clients or the Firm. Brian Berliner, an O’Melveny partner licensed to practice law in California, the District of Columbia, and New York, Melody Drummond Hansen, an O’Melveny partner licensed to practice law in California, the District of Columbia, and Illinois, Randall Edwards, an O’Melveny partner licensed to practice law in California, Richard Goetz, an O’Melveny partner licensed to practice law in California, Carlos Lazatin, an O’Melveny partner licensed to practice law in California, and Jason Orr, an O’Melveny associate licensed to practice law in California, contributed to the content of this newsletter. The views expressed in this newsletter are the views of the authors except as otherwise noted.

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