Officers said the driver was travelling at 50km/h when the vehicle crashed while heading east on Beach Road just before 6pm last Wednesday.
Across the two buses, five people were taken to hospital and 12 were treated at the scene for minor injuries.
A Public Transport Authority spokeswoman said she could not comment on the circumstances of the crash until the police investigation was completed.
PerthNow Digital Edition.
Your local paper, whenever you want it.Get in front of tomorrow's news for FREE
Journalism for the curious Australian across politics, business, culture and opinion.
READ NOWThe spokeswoman said the PTA was unlikely to have suspended the driver because police had ruled out alcohol as a contributing factor.
Police are urging crash witnesses to call 1800 333 000.