Look, no hands: Waymo’s technology being put to the test in California © AP
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After crossing the border bet­ween California and Nevada, Audi’s self-driving test car pulls over.

Nothing is wrong. But the A7 saloon must change num­ber plates if it is to continue in driverless mode while passing through Nevada. It is just one of the quirks of the disparate rules governing tes­ting and development of autonomous vehicles in the US.

Carmakers across the world are pushing to develop vehicles that will drive themselves. The goal is to cut road accidents by eliminating human error, and give freedom of movement to the disabled or others not able to drive.

But cars that drive themselves will need to work where­ver they travel in the world.

Governments are working on rules for self-driving cars. “It’s a bit of a race at the mom­ent because a lot of governments see this . . . and they want a part of it,” says Ian Robertson, a BMW Group board member. “A lot of them want to encourage the industry to come and experiment with it.”

Trials are already under way in many parts of the globe, from the US and Germany to China, Japan and Singapore, among other countries.

Cali­fornia has issued dozens of permits to test self-driving ve­hicles on public roads that have been snapped up by companies from Apple to Google’s Waymo and several start-ups.

However, the regulatory road map that will allow autonomous cars to be deployed commercially — potentially on the roads without safety drivers to take control in an emergency — is far more complicated.

Europe, the US and China are introducing legislation that may pave the way for autonomous cars to operate in regular traffic. Singapore, which has confined conditions and slow-moving traffic, is probably furthest ahead.

In 2016, the US government issued the Federal Automated Vehicle Policy, which laid out some considerations around safety and other issues for self-driving cars. But it stopped short of giving guidance on future rules. “It is not a regulation,” says Joseph Falcone, a partner at law firm Herbert Smith Freehills. “It is not even a proposed regulation.”

While the federal government moves slowly, individual states are still trying to attract carmakers to test in their region. “I think a lot of states are looking to brand themselves as open for business in this space,” says Mr Falcone.

This has led to a hodgepodge of testing, with Florida, Michigan and Washington DC allowing fully autonomous vehicles to operate, another eight states allowing tes­t­ing and another dozen with plans to legislate around self-driving cars.

However, a cross-country set of federal rules may be on the way. The US Congress is in the process of passing legislation that will largely remove restrictions on the operation of autonomous passenger cars.

Audi, which is owned by German carmaker Volkswagen and has launched the first partially autonomous car that will allow motorists to read a book while travelling, believes that the US will be the first market to allow “hands-off” driving by consumers.

In Europe, the EU will introduce its own map for self-driving vehicles by the end of this year. Currently, individual countries are vying to be more attractive than their neighbours for autonomous testing, in a situation similar to states in the US.

If self-driving vehicles are to be governed on a Europe-wide level, that will require a new regulatory framework, and maybe even a new body to oversee and enforce the rules.

“It is not just the safety aspects but also getting the business aspects right: energy, telecoms, water, transport, public transport, rail. I mean, a lot of these sectors have their own regulator,” says Lode Van Den Hende, a partner at Herbert Smith Freehills.

“What do you do if a policeman or someone who accompanies an ambulance has to force cars to override the rules? Someone will have to regulate how that is going to work.”

In China, where central government often clashes with powerful local authorities over industrial policy, there are several potentially competing plans to develop self-driving rules, according to the Brookings Institution, a Washington DC-based think-tank.

Japan and South Korea are seen as trailing other developed regions in setting regulation, although Japanese carmaker Toyota has said it wants self-driving taxis operating in time for the 2020 Tokyo Olympics.

Britain, currently subject to EU rules, is seeking to position itself as a leader in driverless car testing. The UK government has laun­ched a bill that sets out rules on driverless cars, stipulating for instance that insurance policies on a self-driving car are voided if the autonomous system is activated in inappropriate conditions.

But any new rules will have to grapple with the question of when the car is responsible for taking a life in an accident — something that is potentially untenable politically.

Greg Clark, the UK business secretary, told an industry conference this year a “common sense” approach was needed on regulation. “Human error is a more dependable source of accidents and fatalities than well-tested, well-demonstrated, and well-regulated technologies,” he said. “We don’t want to get back to waving a red flag in front of vehicles on the road.”

Copyright The Financial Times Limited 2017. All rights reserved.