With nationwide rules in place for routine flights of small commercial drones, federal regulators on Monday said their next big challenge will be evaluating industry waiver requests to balance innovation and safety.

The regulations for the first time establish standard flight procedures and pilot licensing requirements for business uses of unmanned aircraft weighing less than 55 pounds and flying below 400 feet in daylight hours. In recent months, the Federal Aviation Administration was swamped, processing roughly 5,000 requests for case-by-case approvals of such operations.

But now, applicants will be able to proceed without first obtaining specific regulatory signoffs, as long as they comply with all the limits spelled out in the rules. FAA chief Michael Huerta told reporters the long-awaited step also "greatly simplifies the pilot-qualification process."

In a departure from most comprehensive air-safety initiatives, however, the rules themselves envision that continuing waiver or exemption requests will play a major role in shaping how the FAA regulates the budding industry. That option "will enable innovation to flourish," Mr. Huerta said, declining to predict how many requests are expected.

Other FAA officials have expressed concern about agency staff potentially being overwhelmed by a deluge of such paperwork. Over the next year alone, the FAA expects some 600,000 operators to begin commercial flights under the new rules.

Calling it a "watershed moment" for U.S. aviation, Bryan Wynne, president and chief executive of the drone industry's leading trade association, said unmanned aerial systems are "cleared for takeoff" and "poised for incredible growth."

Still, Mr. Wynne and other industry officials have stressed that the waiver process won't satisfy pent-up demand for more-complex uses of unmanned aircraft—especially at higher altitudes and beyond the sight of operators—or approval of aerial vehicles substantially heavier than the current regulatory limit.

Capping more than two years of debate, some 4,500 written comments and escalating industry turmoil, the rules also won't resolve growing controversy over privacy protections. On such issues, local governments increasingly are pre-empting Washington by staking out positions before federal agencies reach a consensus.

On Monday, Mr. Huerta said the FAA intends to launch a broad public-education campaign about the importance of privacy issues, while also developing and distributing policy guidance aimed at local governments.

Recognizing the need for quick action, the FAA earlier this year established separate registration requirements for all drone users. Agency leaders also have pledged to craft follow-on rules with unprecedented speed, led by regulations due to be released by year-end allowing unmanned vehicles to start flying over crowds. Mr. Huerta said more than six dozen waivers already have been granted for such operations, in advance of formal regulatory proposals.

While stressing the need for caution and adequate deliberation, Mr. Huerta previously said the agency can't afford to "act at the [traditional] speed of government." Integrating drones into the national airspace "certainly is the No. 1 issue" at FAA headquarters, Terry Biggio, a senior FAA air-traffic-control official, told an air-safety conference in Washington last week.

But at this point, agency officials haven't laid out the scope or methodology of future rules. The relevant technologies, as well as safety risks associated with them, continue to develop significantly faster than federal efforts to control them. Some researchers have identified hundreds of incidents in which pilots reported drones flying dangerously close to airports in recent years, prompting many safety experts, drone proponents and lawmakers to call for automated digital "fencing" to prevent such incursions.

Airline-pilot union leaders, meanwhile, still complain about what they contend is a fundamental gap in the regulatory structure: Congress has blocked the FAA from imposing tough new regulations on hobbyists and, by extension, many casual or recreational drone users.

"We have one shot to do this right," Tim Canoll, president of the Air Line Pilots Association, told the same air-safety conference, adding that incorporating unmanned vehicles can't be allowed to degrade current safeguards and "simply cannot shortchange the safety of the system." He said the union, among other things, advocates that the FAA "take a stronger stance in ensuring" that pilots of commercial drones receive adequate ground and flight training.

For now, FAA officials are focused on ensuring that testing facilities are able to cope with the expected influx of tens of thousands of pilot applicants.

Write to Andy Pasztor at andy.pasztor@wsj.com

(END) Dow Jones Newswires

August 29, 2016 15:15 ET (19:15 GMT)

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