SIMIC

The system is part of the "Fit for 55" package to reduce greenhouse gas emissions 55 per cent by 2030 compared to 1990 levels.

The council agreed to phase in shipping until 2026, accepting the commission's proposal on the gradual introduction of obligations for shipping companies to surrender allowances for all emissions on trips within the EU and 50 per cent on voyages between EU and non-EU ports for vessels over 5,000 tonnes.

Climate lobbyists said ministers failed to deliver, saying they had diluted their proposals.

Eco-campaigner, Transport & Environment (T&E) said "unnecessary exemptions" would undermine the effectiveness of the carbon market and "create an unlevel playing field."

Said Carbon Market Watch shipping policy officer Wijnand Stoefs: "The European Parliament position on ETS is very problematic, but at least when it comes to shipping, it is miles ahead of the unambitious and time-wasting council general approach."