From January 1, all airlines using EU airports have come under the EU’s Emissions Trading Scheme (ETS), which has stirred up strong opposition in the United States, China and India.
Any airline that does not comply faces fines of €100 for each tonne of CO2 emitted for which they have not surrendered allowances. In the case of persistent offenders, the EU has the right to ban airlines from its airports.
"There is space in the legislation that has not yet been explored regarding exemptions for equivalent measures," said the new EU ambassador in New Delhi, Joao Cravinho.
"There is room for negotiation, not for annulling the law."
The EU law allows for equivalent measures to be taken into account, which analysts said would cover other ways of reducing emissions in the airline sector.
But the rules do not specify what could constitute equivalent measures.
"Flights coming from countries that have equivalent measures can be exempted. So we need to look at what equivalent measures can be," Cravinho said.
The EU says it needs to put a price on CO2 emissions to guard against impacts of global warming such as crop failures, droughts or flooding.
The airlines carbon tax forms part of measures the bloc says will help it fulfill its pledge to reduce emissions by 20 percent below 1990 levels by 2020.
Critics have said that its unilateral nature violates the Chicago Convention on international aviation, as well as some World Trade Organisation provisions.
Some countries have threatened retaliatory measures, but Cravinho said the EU would not back down on a measure that affected European companies as much as others.
“Any measures that discriminate against European companies will obviously be taken to ... international court," he said.
