TRAVERSE CITY – If you haven’t seen drones buzzing around your neighborhood, park or downtown business location yet, you will soon. The recreational and commercial use of drones, mostly quadcopters, is on the rise.
In February 2015, the Federal Aviation Administration (FAA) started granting commercial drone operators permission to fly drones for business purposes. Industries such as agricultural, energy, utilities, mining, construction, real estate, news media and movie production are already heavily invested in the aerial photographs, videos and data that can be captured by drones. While many people know the word “drone” from the military side, that stereotype won’t last long. The smaller civil drone market, typically under 10 pounds, is expected to grow at steady rates and could be a $30 billion industry by 2020. The global market in that same period is expected to top $100 billion.
Commercial drone operators are highly regulated by the FAA.
For those that want to get into the commercial drone business, there has been a lot of confusion about FAA drone regulations and regulatory compliance. The FAA requires commercial operators to jump through any number of hoops in order to make money using drones. Companies need to obtain permission from the FAA to fly drones for business by securing a Section 333 Exemption, obtaining a Certificate of Waiver or Authority (COA) and complying with the FAA Regulations (FAR), which otherwise govern manned flights. Unlike manned aircraft, drones are easy to buy and relatively inexpensive. Several high-end models with high-end cameras cost less than $3,000.
The ease of obtaining and flying a drone has put a lot of commercial operators in the air. Many, however, don’t yet have permission from the FAA because they have not secured a Section 333 exemption yet, a process, which can take 3 months or more. There has been considerable debate about the FAA’s jurisdiction to enforce its drone regulations and whether the FAA intends to seriously pursue commercial operators who don’t obtain a Section 333 exemption before they fly.
The FAA will issue fines to operators who do not comply with the regulations.
These questions were answered last week when the FAA proposed a $1.9 million fine against SkyPan International out of Chicago, Illinois. SkyPan has been in the aerial photography business for decades. The FAA alleges that SkyPan was conducting flight drone operations without a Section 333 Exemption from the FAA, the required civil COAs and other regulations, which govern drone use. The marketing on SkyPan’s website seem to back up those allegations. According to the FAA, this is “the largest civil penalty the FAA has proposed against a UAS operator for endangering the safety of our airspace.”
Read more about the SkyPan case here ( https://www.dronelaw.pro/faa-recommends-1-9-million-fine-against-commercial-drone-operator/ ) and here ( https://www.dronelaw.pro/anatomy-of-a-faa-enforcement-action-for-illegal-drone-use/ ).
What does this mean for Michigan drone operators?
As of the date of this article, the FAA has granted exemptions to approximately 50 Michigan companies including 30 companies in the Metropolitan Detroit area. Because of its agricultural, industrial and media industries, Michigan is a potential hot spot for commercial drone venture capital, start-up operations and service providers.
The FAA clearly wanted to send a message in the SkyPan International matter. The FAA has been clear that drone safety and regulatory compliance are a priority. While flying a drone commercially without a Section 333 exemption is an obvious violation, there are many other aviation regulations that apply to drones. In most Section 333 exemptions granted by the FAA, there are over 30 conditions and limitations. Each flight must have at least two people on site, a pilot and visual observer. The pilot needs to have a minimum of a sport or recreational pilot’s license (airman certificate). The FAA requires significant paperwork, including notice to the FAA and nearest airport control tower at least 24 hours before each flight.
Customers who hire drone operators are also at risk.
Customers who use vendors for drone activities such as filming, inspections, real estate photography, etc, are beginning to realize that they have exposure if they hire the wrong drone operator. The FAA in the SkyPan investigation subpoenaed SkyPan’s customers when SkyPan refused to voluntarily provide information. Those customers ended up having to hire attorneys to respond to the FAA requests. There are other risks for customers who don’t do their due diligence as well. If there is a safety incident with a drone vendor, the customer may very well become a target of a lawsuit concerning that incident. If it turns out your drone operator isn’t FAA compliant, a good attorney will deep pockets too enticing to pass up. While not likely, the FAA could also fine customers who knowingly participate in unsafe flights outside the aviation regulations.
The metropolitan Detroit area has an opportunity to become a leader in this new and emerging market. Professional drone companies, which make good faith efforts to comply with FAA drone regulations, will quickly stand out from the rest. The pretenders will quickly fade away as customers become better educated about drone regulations and compliance issues, and the FAA ramps up its investigations and fines. There are strong incentives within the commercial drone community to encourage FAA compliance and safe flight in order to legitimize the market. Companies who fly unsafe could ruin it for everybody.
Schaefer is the lead UAV attorney at Traverse Legal, PLC that provides representation to commercial drone operators and drone technology companies. Traverse Legal, PLC is a law firm specializing in technology company representation and provides information to drone clients at https:\\www.dronelaw.pro.
UAV Attorney Enrico Schaefer
https:\\www.dronelaw.pro
