Onerous regulations have cost the UAV industry R400 million


Delays in licensing unmanned aerial vehicles (UAVs) for commercial use have cost the South African industry at least R400 million, industry association CUAASA has revealed.

The Commercial Unmanned Aircraft Association of South Africa (CUAASA) at its annual general meeting on 20 July said that the economic impact resulting from the delay in licensing has been “significant”, with current accumulated losses exceeding R410 million. This is based on information volunteered by companies covering quantifiable losses due to red tape causing contracts to be cancelled, amongst others. As such, the true figure is probably much greater.

According to economist Roelof Botha, at the beginning of the second quarter of 2018, it was estimated that the cumulative loss in business that the UAV industry in South Africa has suffered since the enactment of Part 101 regulations in mid-2015 amounts to approximately R4 billion. The estimated contribution to national unemployment was approximately 46 000 lost jobs.

Former President of CUAASA Dean Polley said the industry undergoes “continuous struggles” to obtain remotely piloted aircraft systems operating certificates (ROCs), and to date, only 26 ROCs have been issued by the regulator since the new UAV laws came into effect in July 2015. There are currently around 400 ROC applications pending with the South African Civil Aviation Authority (SACAA).

The delays and excessive backlog have been attributed to two major factors. Firstly the SACAA does not have the required capacity to effectively implement the regulations. Secondly, every new applicant requires an air service license (ASL), which unnecessarily adds to the complexity of applications and the increased timelines for processing. ASLs are typically required for airlines and other large operators.

During 2017, CUAASA, together with the Commercial Aviation Association of South Africa (CAASA), submitted proposed amendments to the Air Service Licensing Act, which will see the waiver of an ASL for UAVs below a weight of 25 kg. Although the amended Act has been approved by all stakeholders, the new Act still has to be signed into law by the Minister of Transport, CUAASA noted.

As a result of delays, CUAASA has prepared a class action lawsuit worth over R1 billion against the SACAA to try and speed up the regulatory process. This dossier will be presented to the SACAA, Minister of Transport and the shadow Minister of Transport for appropriate action should they fail to respond to CUAASA’s requests.
“The industry can no longer be expected to carry the losses and accept the rising safety issues where 99.5 % of the industry is not regulated. The industry by mere compliance is at a deficit financially compared with non-complying competitors. Timelines to have SACAA process applications and allow companies to operate are not reasonable compared with other AOC (Manned Aviation) operators and international best practices, and has become a serious impediment to progressing this industry,” CUAASA said.

It takes an average of 18-24 months to process an ROC, subject to an operator receiving an ASL. There are also delays in obtaining remote pilot license letters of approval (RLAs) needed to fly a UAV.

Polley said the ABSA UAV light show earlier this month, which involved 300 UAVs flying in formation over Johannesburg, had “raised a lot of eyebrows” as the event was approved very quickly while other operators have to wait years for approvals. As a result, CUAASA will be writing a letter to the SACAA to get clarification on ABSA’s approval process.

CUAASA has proposed several solutions to remedy the current problems, including a national registration of all UAVs using a RICA type process (used for cellphone SIM card registration); eliminating the need for an ASL for UAVs under 25 kg; eliminating the need for multiple registrations for the same type of UAV; and automating ROC applications via an online process. Other suggestions include publishing successful applications so they can be used as templates and establishing a dedicated UAV evaluation area.

CUAASA said UAV operators in South Africa were suffering from delays receiving their Air Services Licenses, with the Air Services Licensing Council only sitting one day per month and only reviewing three applications. At this rate it will take eleven years to clear the current backlog of 400 entities applying for ROCs.

In spite of the regulatory red tape, the UAV industry in South Africa is growing. There are five approved UAV training organisations (ProWings, Cranfield Aviation Training, RPAS Training Academy, UAV Industries and Drone X), and over the last 12 months, around 360 remotely piloted aircraft pilot’s licenses (RPLs) have been issued. At this rate, there will be more UAV pilot licenses being registered than normal pilot licenses. On average, it costs R25 000-R30 000 to obtain an RPL.

In the second quarter of 2018, Dr Roelof Botha was tasked with conducting a second economic assessment study of the South African UAV industry, following on from the first one done in the beginning of 2017, and he surmised that the macro-economic impact of the drone industry for 2018 could result in revenue generation of R4 billion per annum, up from R2.4 billion in 2017, and the creation of approximately 46 000 jobs, up from 26 000 in 2017.