Developed by Calgary, Canada-based 4D Driving Technologies, SafeHalo consists of three main components: a "telemetry hub" module that's plugged into the car's OBD-II diagnostic port, a small beacon device that's discretely placed on the passenger side of the cabin, and an iOS/Android app. All of these wirelessly communicate with one another via Bluetooth.
If the driver is travelling alone, the beacon isn't needed or used. In this case, as soon as the hub detects that the engine has started and the car has been put in gear, it causes the app to block all incoming calls and texts, and to disable the ability to place them – the exception is outgoing emergency 911 calls, which are still possible.
Should other passengers be present, though, then the beacon is used to triangulate the location of the phone within the cabin, based on the received strength and direction of its Bluetooth signal. If it's determined that the phone is in the immediate vicinity of the driver's seat, then calls and texts are still blocked. Once that phone is passed to a passenger in another seat, though, it gets unlocked, allowing that person to use it on behalf of the driver.
And no, the sort of person who texts and drives in the first place likely won't be keen to use the system on themselves. Instead, it's mainly intended to be purchased and installed by people such as parents or employers, to keep their children or fleet drivers from using their phones irresponsibly. And if a driver should try deleting the app or unplugging the hub, the parent/employer will be notified via the app on their phone.