Speaking in a telephone interview, the International Civil Aviation Organization's Roberto Kobeh Gonzalez outlined four possible mechanisms that could form an alternative to a controversial European Union scheme that requires foreign airlines to pay into its emissions trading scheme.

"The market-based measure development is a very difficult exercise, very complicated, with a lot of implications, political, social, economic," said Gonzalez, president of ICAO's governing council.

The council met this week to discuss the issue, and directed a working group to continue studying the four options and report back in June.

Gonzalez characterized Wednesday's meeting as very constructive. He said he expected one or more of the four options will be ruled out in June, but he did not want to speak for the council.

Gonzalez said some countries had raised concerns about how an ICAO emissions scheme could respect the principle of "common but differentiated responsibility." That concept argues that developed countries should shoulder most of the burden of cutting emissions.

ICAO must find a way to reconcile that principle with its own governing document, known as the Chicago Convention, which Gonzalez said requires "non-discrimination" between members.

The four options being considered are mandatory offsetting of emissions from airlines, mandatory offsetting with some revenue-generating mechanism, and two cap and trade systems. Under one, all aviation emissions could be traded. Under the other, only increases or decreases from an initial emissions baseline could be traded.

A coalition of more than 20 countries, including China, Russia and the United States, opposes the EU scheme, which took effect on January 1. They say the plan infringes on their sovereignty and the conflict could escalate into a trade war.

Sources said on Thursday that China was suspending the purchase of 10 more Airbus (EAD.PA) jets, raising the stakes in the dispute.

(Editing by Janet Guttsman)

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