Brussels wants to toughen rules for firms handling plastic pellets but divisions emerged as representatives for the bloc's 27 nations discussed whether small businesses should be let off the hook, diplomatic sources said.
"There was more drama than usual," said a source.
Bold EU plans to tackle climate change have increasingly come under fire from critics arguing they hindered the bloc's competitiveness at a time where it needs to boost growth and relaunch its industry.
The European Commission has proposed legislation demanding companies handling and transporting microscopic pellets, called nurdles, take steps to reduce spillages in the environment.
Made from fossil fuels, the tiny nurdles constitute the building blocks of most plastic products from car bumpers to salad bowls -- and often end up polluting beaches and oceans.
Under the commission proposal, medium and big operators will have to get a third-party certification of compliance, while small ones will be allowed to make do with a self-declaration.
Countries led by France and Spain, had agreed that the certification requirement should be extended to small firms, if they handle more than 1,000 tonnes of the stuff every year.
But the move has faced a stiff opposition from the commission, which says it would go against its new drive to reduce administrative burdens for businesses, diplomats say.
"This raises the question of lowering environmental ambitions," said one source, arguing that the commission was "going too far" in its deregulation push.
Worried about the impact on their maritime transport industry, Greece and Cyprus are backing the commission, with the support of Germany, according to diplomats.
The commission said it was "fully committed" to its proposal on plastic pellets but remained "mindful of avoiding regulatory burdens on small companies in particular".
According to EU data, up to 184,000 tonnes of pellets per year -- the equivalent of 20 truckloads each day -- are dispersed into the environment across the 27-nation bloc due to mishandling.
Brussels hopes its proposal will reduce pellet release by up to 74 percent.
A common text has to be agreed by the commission, member states and the European parliament before it can come into force.
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