The need for Operator Licences – in the form that we know them now – originated with the Transport Act 1968, and is now governed by the Goods Vehicle (Licensing of Operators) Act 1995 (the Act). Not exactly catchy titles, but they do what they say on the tin. Gateley’s Edmund Locock writes.
The Act specifies that nobody can use a goods vehicle on the road for hire or reward or in connection with any trade or business carried on by him except under an Operator’s Licence.
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This is a wide-ranging definition which, subject to the specific exceptions discussed below, acts as a catch-all for most commercial heavy goods vehicle operations in the UK.
Responsibility for issuing and enforcing Operator Licences lies with the Traffic Commissioners, of which there are eight, each presiding over a specific region of the UK. Operators need to obtain licences for each region in which they wish to operate.
Exemptions
A number of vehicle categories are exempt from the Operator Licence regime. While too numerous to list exhaustively, the main exemptions for Operator Licences relate to:
- Small goods vehicles, which for rigid vehicles means they have a relevant plated weight not exceeding 3.5 tonnes, or have no relevant plated weight but have an unladen weight not exceeding 1,525kg;
- Old vehicles registered pre-January 1977 with an unladen weight of not more than 1,525kg and a gross weight of not more than 3.5 tonnes;
- Vehicles used only for internal carriage by a haulier established in an EU member state other than the UK and not established in the UK, and
- Vehicles used by the police, fire brigade, the ambulance service and those used for funerals. It would, after all, be awful for one’s hearse to be seized on the way to a funeral.
Who is a User?
The act talks about those who use vehicles on the road, but who exactly is a ‘user’ for the purposes of the legislation?
In the finance and leasing industry, where ownership of vehicles is almost invariably separate from their use and possession, this is a question of key importance. The user of a vehicle must apply for and hold a valid Operator Licence in respect of a vehicle, but where the vehicle is subject to a lease or hire-purchase agreement, it is the funder whose vehicle is at risk should it be seized for non-compliance.
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By GlobalDataThe wording of the act itself is less than clear, stating: “For the purposes of this Act, the driver of a vehicle, if it belongs to him or is in his possession under an agreement for hire, hire-purchase or loan, and in any other case the person whose servant or agent the driver is, shall be deemed to be the person using the vehicle; and references to using a vehicle shall be construed accordingly.”
What the legislation means, this writer believes, is that you will need an Operator Licence where:
- You own and drive the vehicle;
- You are in possession of the vehicle under the hire-purchase or lease agreement and drive the vehicle, or
- It is your employee or agent who is the driver of the vehicle, whether or not you are owner or lessee of the vehicle.
For funders, therefore, it is essential that the terms and conditions of any lease or hire-purchase agreement incorporate a condition that the lessee, sub-lessee – and anyone else representing a user during the term of the agreement – hold a valid Operator Licence in respect of the vehicle at all times.
Consequences
Operator Licences are personal to the individual or company to whom they are granted, which means they cannot be transferred, sold, borrowed or lent. They are also easily lost: fall foul of the Traffic Commissioner’s strict regulatory requirements and the consequences will be severe.
Those who breach the terms of their Operator Licence can have their licence revoked, suspended or curtailed by the Traffic Commissioner. The commission can also direct that the person who was the holder of the licence be disqualified, potentially indefinitely, from holding or obtaining an Operator Licence in the future.
In case that is not enough incentive to comply with the act, not holding a valid Operator Licence is also a criminal offence; any person found guilty will likely also face substantial financial penalties.
Vehicles found operating without a valid Operator Licence can also be seized, impounded and scrapped after 21 days unless the owner can successfully appeal its seizure to the Traffic Commissioner. The appeal process is complicated, and there is certainly no guarantee that your vehicle will be released.
Summary
For users, the importance of holding a valid licence for each vehicle in a fleet cannot be overstated. The consequences for non-compliance are severe, and potentially criminal.
For funders, it is essential that any agreement expressly requires customers, and anyone else classified as a user of the vehicle, to hold a valid Operator Licence at all times. A customer breaching this condition will be putting your assets at risk.
by Edmund Locock
