The drones market is soaring. Some have likened the growth of the drone market to the growth of the internet in the 1990s and there is no doubt about it: drones are revolutionary, and they are here to stay. However, like the internet, along with the host of benefits that drones can offer, there are also a number of associated risks. One such risk, which has become a more frequent reality in recent months, is the risk of mid-air collisions with airliners, or "drone strikes".

The Government has recognised both the benefits and dangers of the growing drones market and, in order to ensure that market flourishes safely and securely, it launched a consultation (Consultation on the Safe Use of Drones in the UK)(Consultation), dealing with areas of drone use from testing and insurance to registration and electronic identification of drones.

This article summarises the current regulatory framework, looks more closely at the issue of liability and considers the Consultation.

Regulatory Framework

The current legal framework for the use of drones has developed in piecemeal fashion, reacting to developments in the market.

Under EU regulation, unmanned aircraft of more than 150 kg which are neither experimental nor used for State purposes are required to have a European Aviation Safety Agency (EASA) airworthiness certificate. Regulation of unmanned aircraft under 150 kg is the responsibility of national aviation authorities - in the UK that is the Civil Aviation Authority (CAA).

In the UK, unmanned aircraft weighing 20-150 kg need airworthiness approval from the CAA. Those weighing under 20 kg (small drones) are exempt from registration and licensing requirements as long as they comply with relevant statutory requirements. Amongst other limitations, drones must not be flown in "controlled airspace" or within an airport, drones must be flown within the direct unaided line of sight of the person operating it, and, if fitted with a camera, drones must be flown at least 50 m away from any person, vehicle, building or structure, and must not to be flown within 150 m of a congested area or a large group of people (such as sporting events or concerts).

Whilst all drones must be operated subject to the normal rules of the air and must not create a hazard or endanger any person or property (and the person operating the drone must also be satisfied that the flight can be conducted safely), the surge in the number of drones coupled with a growing number of amateur pilots is contributing to an increased risk of drone strikes.

This is reflected in recently reported figures which show that there were 34 reported near-misses between January and June 2016, compared with 29 for all of 2015 (most were reported close to major airports). In April last year, a British Airways A320 reported a possible collision with a drone near London Heathrow. There was also a significant near-miss near Stansted airport in July involving a Boeing 737.

Liability for drone strike

If it is possible to locate the drone pilot, the CAA can use its powers to prosecute individuals for misuse of drones. Penalties include up to five years' imprisonment for endangering an aircraft as well as fines for less dangerous activities.

It is likely that any collision with a drone leading to death or injury would fall under the Montreal Convention 1999 (Convention). Under the Convention, an airline will be liable if death or bodily injury occurs as a result of an accident which occurs either on board or during the course of embarkation/disembarkation of an aircraft. A drone strike would qualify as an accident, although only physical injury (or mental injury which results from a physical injury) can be compensated. Claims for stress, anxiety, Post Traumatic Stress Disorder or otherwise will not succeed against an airline.

Where a flight has been cancelled or is significantly delayed, EC Regulation 261/2004 (Regulation) will apply. The Regulation requires the operating carrier to pay a fixed level of compensation in the event of cancellation or delay over 3 hours, and must offer a choice between reimbursement or re-routing if a flight is cancelled, or reimbursement only (for a delay of more than five hours), as well as care and assistance in the form of hotel and subsistence.

Airlines are not required to pay the fixed compensation if the delay is caused by "extraordinary circumstances". Comparisons have been made between bird strikes and drone strikes. Some case law suggests that bird strikes would not be considered as "extraordinary", even though they are outside of the control of the carrier (on the basis that they are common and therefore inherent in the normal operation of the carrier). It might therefore be possible to argue that drone strikes could also be deemed not "extraordinary".

Looking to the future

As discussed above, the rules governing the use of drones and liability for misuse are evolving. With ever increasing drone use, greater regulation and liability for misuse is likely to follow.

In the Consultation respondents are asked to consider, amongst other things, increasing deterrents for breaking the CAA guidance and statutory instruments, the possibility of no-fly zones, registration of drones and electronic identification of drones.

Certainly, compulsory registration of drones seems likely, following introduction of these requirements in the US in December 2015. Whether tracking will be combined with this registration is currently unknown.

Final thoughts

Noah Poponak of Goldman Sachs Research has recently commented that he sees drones evolving into a $100 billion market by 2020. The European Commission expects that, within 20 years, the European drone sector could directly employ more than 100,000 people and have an economic impact exceeding €10 billion per year, mainly in services. With such huge levels of growth predicated, it is inevitable that our skies will become even busier.

Against such a backdrop, the need for a refreshed regulatory framework, which takes into account the trajectory of the drone market, appears necessary. This is particularly the case in relation to the protection of airlines, their crew and passengers against the risk of drone strikes. Positive changes are being discussed and the UK regulators are taking an active and positive role in the discussion. It follows that reform is on the horizon.