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BRUSSELS, Sept 5 (Reuters Point Carbon) - The EU agreed to a deal late Wednesday to scale back its law regulating carbon from flights as U.N. negotiators pledged to craft a global pact on aviation emissions that would not take effect for seven years.
EU officials agreed at U.N. talks in Montreal to only include emissions from flights over European airspace in the bloc's Emissions Trading Scheme (ETS), said the EU's top climate official Jos Delbeke, a move that would scale down a law that covers all flights to and from Europe.
The deal, which still needs to be signed off by a full meeting of the U.N.'s aviation body ICAO ending Oct. 4 and by EU lawmakers, drew fire from green groups and sparked a renewed threat of legal action by European airlines.
"There are bits and pieces of that text that make everybody unhappy. So it's maybe not too far away from an ideal compromise," said Delbeke at an event at the EU Parliament in Brussels.
The deal falls short of the worldwide pact the EU had hoped for in November 2012 when it exempted foreign flights for one year to give ICAO more time to strike a global deal and avert a global trade war from major trading partners such as China, India, and the U.S. that said the measure infringed on their sovereignty.
The agreement will force airlines to surrender more permits for carbon dioxide (CO2) emissions than the current temporary practice of regulating domestic EU flights, boosting permit demand to 80 million to 2020 from 48 million, Point Carbon analysts said this week.
Bill Hemmings from the environmental group T&E said the move was an "unnecessary concession" that had little to do with efforts to tackle climate change and did not amount to a guarantee that ICAO would tackle aviation emissions globally.
"This is appeasement on a grand scale. How can it be that the future of EU policy in this sector can be decided behind closed doors by 40 faceless men and a few women in Montreal?" he told the Brussels event.
Peter Liese, a senior member of the EU Parliament, said the assembly needed to scrutinize the plan further but hinted that it may have to accept the measure as the best possible compromise.
"It is far from an ideal solution... (but) I'm really concerned that if we just oppose what is on the table then we may see a total collapse of our effort," said Liese.
He said the Parliament might propose to merely to extend its suspension the global reach of the EU ETS rather than re-working its law permanently.
"Personally I would not be ready to give another blank cheque to ICAO and say if they don't agree in 2016 we just look at it then," he added, referring to when the U.N. body has pledged to finalise the global deal. LEGAL THREAT
The EU Parliament and member states would have to agree to the new law by early next year to prevent an automatic resumption of existing legislation.
But this could re-start a legal case from the European Low Fares Airline Association (ELFAA) over fears it will distort competition, said John Hanlon, secretary-general of the group.
"We will be watching very closely... If (the deal) is not going to deliver what we have a right to expect, we will reactivate that suit," said Hanlon.
ELFAA represents some of Europe's biggest carriers including Easyjet and Ryanair and believes its members face discrimination under an EU-only scheme versus carriers with dominant business outside Europe. (Reporting by Ben Garside)