The European Commission cut on Friday Bulgaria's greenhouse emissions quota for 2008-2012 by 37%, saying that the country's environment ministry did not offer compelling arguments in defence of its demand for a bigger quota.

Bulgaria will have the right to trade up to 42,3 million tonnes of carbon dioxide equivalent, the European executive said in a statement.

Bulgaria asked for 67,6 million tonnes, aiming to capitalise on its relatively clean record when it comes to the Kyoto protocol on cutting emissions, and sell a large amount of its carbon credits to other countries.

Its greenhouse emissions in 2005 were 40,6 million tonnes of carbon dioxide equivalent, according to EC data, and the country has plans to further cut emissions by upgrading its biggest polluters - thermal power plants and the Kremikovtzi steel mill.

Fellow EU newcomer Romania, which joined the bloc together with Bulgaria in January, also received a smaller quota than it asked for - 70,8 million tonnes, compared to the 95,7 million tonnes Bucharest had in its proposal.

Bulgaria will appeal the Commission's decision and could take the matter to court, the country's Environment Minister Dzhevdet Chakarov said.

"We will not allow Bulgaria to turn from a potential seller of carbon credits into a buyer," he told reporters.

"The decision to cut the emission quota by 37% could have a very strong negative impact on the Bulgarian firms' ability to compete in Europe," he added.

However, the EU has long been concerned by Bulgaria's measures on monitoring greenhouse gas emissions and the Kyoto protocol implementation.

Earlier this month, the European executive has even launched an infringement procedure against Bulgaria for failing to provide enough information on the issue.

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