Commercial context and opportunities

Sustainability, technological advances and innovation in ‘last-mile’ strategies are fuelling a rise in drone usage – in particular, so far, in retail and medical-supply delivery. But, increasingly, drones offer other, wide-ranging, opportunities in today’s commercial world. For example:

• Dublin-based drone delivery company Manna now offers suburban deliveries of hot and cold food and beverages, as well as grocery deliveries. Customers can take receipt of their perishable goods within just minutes of placing an order. Apart from commercial efficiency, the company cites ESG advantages, such as zero emissions from its environmentally friendly drones, fewer delivery drivers meaning less congestion and fewer accidents on the roads, and support for local businesses and communities.
• UK-based drone logistics company Skyports Drone Serviceshas partnered with Norwegian energy firm Equinor, with the aim of delivering supplies and other cargo to offshore drilling platforms located in the North Sea.
• Drones can access and monitor infrastructure and conditions in areas difficult or dangerous for humans. They therefore present significant opportunities to solve logistical challenges and improve safety and sustainability across the energy and infrastructure sector – for example in relation to drilling platforms, pipelines, power lines, wind turbines and other offshore infrastructure.
• The construction industry is beginning to make use of drones’ 2- and 3- dimensional and aerial imaging abilities, to conduct building and environmental surveys.
• Drone imaging services are also being used in disaster-planning and response; thermal imaging and reconnaissance work; communications strategies; cartography; security; weather monitoring; traffic planning, monitoring and management; and logistics, to name but a few.
• In terms of manufacturing, supply chain and warehousing, IKEA is embracing inventory drones across 16 of its locations in Europe. These scanning drones can provide around-the-clock updates to inventory, and can reach vertical heights that humans and most robots can’t.

UK drone laws and regulation

The commercial and sustainability drivers for an increase in drone usage are clear, and the legal and regulatory environment is developing to keep pace.

Drone law is primarily governed by section 60 of the Civil Aviation Act 1982 and the Air Navigation Order 2016 SI 2016/765 (as amended) (the ANO), which regulate and place obligations on drone operators and pilots. Key provisions are:

• a person must not recklessly or negligently cause or permit an aircraft to endanger any person or property; and
• drone flight restrictions apply in the vicinity of airports and airfields.

Drone operations in the UK are generally categorised as ‘open’, ‘specific’ or ‘certified’, according to increasing levels of risk, size/weight and, correspondingly, regulation. Many UK commercial drone operations will fall within the ‘open’ or ‘specific’ categories. Most will require compliance with registration and identification rules, some will require pilot licensing, and the latter will also require risk assessment and operational approval from the CAA.

Detailed application of the ANO to drone operations is explained in guidance from the UK Civil Aviation Authority (CAA): Unmanned Aircraft System Operations in UK Airspace (CAP722). So far, CAP 722 focuses mainly on visual line of sight (or VLOS) drone operations and requires that the operator must always be able to see the drone during flight, sufficiently to be able to maintain control of it. (The maximum distance at which this can be safely achieved depends on various factors, and may change from flight to flight.)

The CAA is responding to market opportunities and challenges all the time, however, and has recently published a roadmap for a major increase in drone use. The plan involves drones flying regularly and routinely beyond visual line of sight (BVLOS). That can enable a faster, more efficient flight network, capable of reaching more remote and hard-to-access areas. The CAA is currently focused on establishing routine BVLOS operations by 2027.

Apart from CAA/aircraft drone rules, breach of which could result in criminal liability and/or civil liability and damages, commercial drone use can prompt other legal issues of which operators should be aware. For example:

• Trespass is the physical intrusion on another’s land; and nuisance is an interference with the use of enjoyment of one’s land, without a physical intrusion, but which causes damage. An unreported case from 2023 is the first in which a court has found drones in flight to be causing trespass.  Also in 2013, the Supreme Court, in Fearn and Others v Board of Trustees of the Tate [1], considered (and found) intangible, visual, intrusion to be a nuisance for the first time since a medieval case of 1341! It’s feasible that loud and/or persistent drone flights could constitute a noise pollution and/or public nuisance [2].
• Where drones are equipped with cameras or other recording apparatus, human rights, privacy and data protection legislation and regulation would come into play (see below).
• Drones are usually operated via radio frequency or the internet. They can be particularly vulnerable to cybersecurity concerns (hacking/manipulation/jamming), sometimes referred to as ‘drone-jacking’.
• Depending on the particular circumstances, other causes of action or legal risks could arise including: breach of any relevant local bylaws, negligence, harassment/stalking and/or product liability issues.
• Commercial operators will generally also have to have regard to contractual terms governing the supply, operation, maintenance and insurance of drone equipment. They’ll also have to stay up to date with a changing technological and regulatory landscape.
• Indoor drone use, for example in relation to warehousing inventory and logistics, isn’t governed by the CAA and unmanned aircraft legislation and regulation, but may be subject to health and safety, data protection and privacy, insurance, and other laws and regulation (in the same way as any other indoor commercial operation).

Drones and GDPR/data protection

Across various sectors, drone use for surveying purposes, in particular, is on the rise. But taking aerial images of sites risks the capture of personal data in the form of images and, sometimes, audio recordings. Regardless of whether that capture is inadvertent, there will likely be UK GDPR [3]/data protection implications. Because using drones can result in the collection, use, or sharing of personal data (including information about individuals who are not the intended focus of the recordings), data controllers must be able to ensure they can comply with UK GDPR.

There are several factors to consider in relation to GDPR compliance. A key issue is whether drone operators/data controllers can use technology to blur images of individuals or other identifying factors (such as car number plates, for example) at the point of capture. If so, that can achieve privacy by design. Others non-exhaustively include whether the drone use can be strongly justified; whether the operator/data controller can demonstrate that any recording and/or streaming can be switched off; that data is not retained or shared unnecessarily; and that data is disposed of safely. The Information Commissioner’s Office (ICO) has published guidance on UK GDPR compliance in the context of drone use and inadvertent data capture.

If the proposed use is for surveillance purposes where capture of personal data may not be inadvertent, the ICO’s wider surveillance guidance should help data controllers with compliance.

Undertaking a data protection impact assessment (for which the ICO has a helpful template), can help operators/data controllers to map out ways in which drone use can be designed and monitored to minimise or avoid personal data collection. That can then inform the updating of privacy policies, data retention protocols, staff training programmes and drone use contracts and practices.

Drone use: Legal and practical advice

And there are other legal and practical considerations for supply chain operators/logistics professionals:

• Will it be preferable for the business to operate its own fleet or to contract with third-party drone delivery providers? If the latter, on what terms?
• What risk assessment and management measures are in place to ensure flying with care?
• Apart from legal liability, any failure to fly with care which results in a headline-hitting accident could have significant public relations consequences.
• Fulfilment and supply chain issues. Whether drone delivery will be used direct to customers or elsewhere within the supply chain, consideration will need to be given to appropriate terms and exclusions in all relevant contractual arrangements. Matters to take into account will (non-exhaustively) include: delivery failures due to mechanical, technical or communication faults; damage to goods; delays; and so on.

Commercial drone use: How we can help

Innovations and advances in drone services, capabilities and regulation have the potential to revolutionise operations across retail, healthcare, infrastructure and energy, manufacturing, supply chain and logistics. However, the legal issues surrounding drone operations can be complex and multifaceted. Walker Morris’ Regulatory, Commercial and Technology specialists can provide legal and practice support as you navigate this evolving landscape. We can help you:

• stay informed about, and train staff on, the ever-changing technological and regulatory environment
• obtain any necessary licences and permits
• prioritise safety, privacy, and socio-environmental concerns
• implement a robust but flexible contractual framework.

We can also provide upfront, comprehensive commercial and risk management advice on policies, procedures and contractual arrangements to ensure your drone delivery projects fly! If or when any issues do arise, our dispute resolution specialists can offer straightforward, strategic solutions.

Proactively addressing legal challenges will enable responsible businesses to reap the benefits of this transformative innovation, while maintaining compliance with drone laws and GDPR, and safeguarding their reputations. Please contact Jeanette Burgess, James Crayton or Jack Heward for further information or advice.

[1] [2023] UKSC 4 – see our briefing.

[2] Section 76 of the Civil Aviation Act 1982 does, however, provide a statutory defence to trespass or nuisance if the drone flight is at a reasonable or ordinary height and is carried out in accordance with the ANO.

[3] Data Protection Act 2018 (also known as UK GDPR). For more information on the UK’s data protection regime, see Walker Morris’ briefings: Impact of Brexit on UK data protection; and Data reform on the horizon.