Prague  - Japan and the Czech Republic Tuesday signed a memorandum that paves the way for Japan to buy surplus greenhouse gas emission credits, the Czech Environment Ministry said.

Japan has so far failed to fulfil its obligation under the so- called Kyoto Protocol to cut by 2012 emissions of gases believed to cause global warming by 6 per cent from the
1990 levels.

The country, which actually saw its emissions rise by 7.8 per cent in 2005 compared to 1990, plans to make up for it by buying emissions credits elsewhere, as allowed under the 1997 international pact aimed at curbing global warming.

The amount and price of emissions allowances that the Czech Republic would sell to Japan "will be a matter for further talks," the ministry said in a statement.

Japan has been shopping for credits across the former Soviet bloc, which has benefited from the Kyoto trading scheme.

Eastern European countries vowed to cut their CO2 emissions by eight per cent compared to the volumes discharged in 1990.

They easily met their commitment when their heavy-polluting communist-era industries collapsed in early 1990s following the fall of communism in Europe in 1989.

Under the trading scheme, the ex-Soviet countries are allowed to sell their excess quotas directly to other nations or in auctions to private companies.

The Czech Republic is contemplating selling some 100 million AAUs, or rights to discharge an equivalent of one ton of CO2 in the scheme's 2008-2012 period.

The ministry said it estimates to make between 10 billion to 25 billion koruny (610 million to 1.5 billion dollars). (dpa)