The Cayman Islands currently do not manufacture vehicles and as such rely on the importation of all vehicles used on its roads. Every make and model motor vehicle can be found on Cayman’s roads, with established dealerships for some of the better known names. Against this backdrop, international manufacturers, dealers, importers and owners are guided by laws and regulations which are primarily established to ensure compliance with the safety, technical and environmental standards of the Cayman Islands, which are in line with international standards.
Some of the main laws and regulations are considered in this overview.
Under The Traffic Regulations, 2017, The Traffic (Seat Belts) Regulations, 2012 and The Sale of Goods Law (1997 Revision), vehicles intended to be operated on public roads in the Cayman Islands (or sold for that purpose) are subject to a variety of safety laws, regulations, rules and standards. These include guidelines specific to seat belts, tyres, airbags, lights, mirrors and brakes.
The Traffic Regulations specify, inter alia, that vehicles used on roads are required to:
(a) be fitted with tyres that comply with regulations (section 11);
(b) have two independent braking systems in good working order, one of which is capable of being operated while vehicle is stationary (section 12);
(c) be fitted with proper lights in compliance with the light restrictions and the minimum lighting requirements under the law( section 13); and
(d) be fitted with at least two driving mirrors to enable view of traffic approaching from rear (section 15).
To ensure compliance, all vehicles used on public roads must be certified to meet certain safety standards on inspection. It is only after this has been done that a certificate of road worthiness will be issued which is a prerequisite for licensing a vehicle for operation within the Islands.
The Traffic (Seat Belts) Regulations, 2012 specify, inter alia, that all vehicles shall be fitted with a seat belt on driver’s side and a seat belt on each passenger’s seat in the vehicle (section 4). Seat belt usage is also closely monitored and it is an offence for the driver and front passenger not to be properly buckled up while the vehicle is operating.
Under The Sale of Goods Law (1997 Revision) there is also an implied condition as to fitness and quality of goods (section 15) and this can of course be elaborated upon in certain contracts of sale.
New Safety Standards
As a part of its safety standards, the Cayman Islands have introduced new Electronic Vehicle Registration (EVR) which replaces the former registration stickers. Electronic number plates are replacing the older license plates and registration coupons affixed inside the windscreen. While the new registration coupons look quite similar to the former registration stickers, they are distinctly different in that radio-frequency identification (RFID) chips are embedded in them and serve to store data and respond to radio signals. The same technology is present in the electronic plates.
The EVR system is not so new to other territories, being in existence for over a decade. Other countries who have already adopted this system found the following key features particularly attractive:
Notwithstanding these notable benefits, there was significant controversy surrounding the implementation of the new EVR system in the Cayman Islands. The primary issue was not the technology itself but the attendant cost of implementation and privacy concerns. With a population of around 60,000 and some 44,000 registered vehicles travelling across 100 square miles, the EVR system was seen to offer limited benefits to the Cayman Islands to justify the cost.
The EVR system has extensive capabilities but for the Cayman Islands there are two main purposes which were presented:
It is known that annual inspection of motor vehicles is required to protect public safety. A government audit of the Department of Vehicle and Drivers’ Licensing (DVDL) in the Cayman Islands indicated that more than half of the registered vehicles had expired registration tags. The manual compliance method had proved to be ineffective in controlling or limiting the number of vehicles that are being driven on Cayman’s roads without licensing, registration or insurance. The EVR system has the capability of electronically notifying the DVDL of vehicles operating without inspection, licensing and insurance.
While the safety and monetary benefits of the EVR are notable, there is growing concern over a driver’s right to privacy and data breaches. The motoring public is concerned that an individual has a right or expectation of privacy while driving and that being tracked is an invasion of one’s privacy. There is also potential for misuse of information obtained by the EVR system by hackers, private investigators, etc. Other concerns relate to enforcement of speeding violations and lack of due process in cases where an individual does not have a fair and timely opportunity to defend themselves when they are unaware that they have been caught speeding.
On August 13, 2018 the Traffic Law was amended to allow for the implementation of the EVR system, among other things, but it is not yet in force and even then, it does not cover the use of the data collected by the RFID system. Similarly, the proposed Data Protection Law which is scheduled to come into effect January 2019 addresses collection, storage, process and use of personal data and will offer very little, if any protection of drivers’ personal data collected through the EVR system. Personal data processed for any of the following purposes are specifically exempt under the proposed data protection law:
a. the prevention, detection or investigation of crime;
b. the apprehension or prosecution of persons who are suspected to have committed an offence anywhere; or
c. the assessment or collection of any fees or duty, or of any imposition of a similar nature, in the Islands.
Additionally, the processing of personal data for the purposes of any monitoring, inspection or regulatory function connected with the exercise of a public function, for example those relating to public safety and any monetary, budgetary and taxation purposes in the Islands, are exempt under the proposed data protection law. It may very be well be that neither current nor proposed legislation in the Cayman Islands addresses the growing concerns of the EVR system and that a citizen is unable to bring action against the DVDL for misuse of personal data or unauthorized disclosure of information. Like other countries, specific driver protection privacy laws as well as laws regulating governments control of the data collected on the EVR system will no doubt be required in the Cayman Islands.
Technologically based systems increase internet connectivity and therefore, the EVR is susceptible to cyber-attacks. Legislation may offer some protection as we have seen through the various privacy laws in the United States of America, for example, the US Patriot Act. Until the new laws are introduced, the Cayman Islands government may need to employ best practices to protect privacy rights of vehicle owners as well as capabilities of the EVR system or other technologies which may provide safeguards towards protecting the DVDL’s database and network in the short term.
Technical aspects of vehicles being sold or operating in Cayman are also closely regulated. Many of the technical aspects are closely interwoven with matters already discussed in relation to safety.
As briefly referred to previously, the importer/licenced vehicle dealer has an implied duty to ensure that goods imported for sale are fit and proper for the purpose and will be road worthy in accordance with the law.
With respect to registration and licensing, The Traffic Law stipulates that vehicles in the possession of licensed vehicle dealer are exempt from the need for registration but are subject to provisions as to trade plates as may be prescribed (section 7). Save for this exemption, the Traffic Law imposes registration and licensing obligations on the owner of the vehicle. Imported vehicles are subject to inspection before being used on the road unless they are being taken from the port of import directly to a licenced vehicle dealer (section 61).
There are also environmental laws, regulations, rules and/or standards applicable to the operation of vehicles, which relate, for example, to air pollutant emissions, noise emissions and fuel economy.
It is interesting to note that the Public Health Law (2002 Revision) establishes that all imported vehicles are required to pay through customs an environmental impact fee (section 57). (This is in addition to customs duties and fees, as well as relevant port charges, which the importer is charged with paying under the Customs Law (2017 Revision), the Customs Tariff Law, 2017 and the Port Regulations (2018 Revision).
It should also be noted that the Dangerous Substances Law (2017 Revision) provides for the establishment of a Fuels Standards Committee which will be responsible, among other things, for setting and publishing standards of fuel to be imported and sold in Cayman and which is likely to include the quality of gasoline. Presently, there are two grades of gasoline which are distributed under the following denominations: (1) Pure 89 and Pure 93; and (2) 5000 and 8000 (which is akin to 89 and 91 Octane).
The regulatory framework which governs motor vehicles operating (or imported for operation) on the roads of the Cayman Islands has kept in line with many of the international standards and practices. Generally, manufacturers, distributors or importers are able to import motor vehicles in to the Islands which are compliant and without the need for any modifications. While many of these regulations are therefore not extraordinary, the introduction of the new electronic vehicle registration (EVR), which is still undergoing a period of transition in terms of implementation, has created a fair amount of buzz with interesting legal ramifications.
* Gina M. Berry is the Country Managing Partner of Higgs & Johnson’s Cayman Islands office, where she also heads the real estate & development team. Ms. Berry has practiced law in the Cayman Islands for over 19 years, with her practice encompassing the representation of an international motor vehicle manufacturer and fuel distributor. Gina can be contacted at firstname.lastname@example.org.
Francine E. Bryce is a Senior Associate in Higgs & Johnson’s Cayman Islands office, where she carries on a vibrant corporate and commercial practice which includes representing an international motor vehicle manufacturer and fuel distributor. Francine can be contacted at email@example.com .