European car makers could be fined billions of euros in penalties each year for failing to meet EU pollution limits, German newspapers have reported, citing draft proposals by the European Commission.

Reuters, citing the Frankfurter Allgemeine Zeitung (FAZ) and Financial Times Deutschland (FTD), said Brussels may charge EUR95 per gram and per car for excess carbon dioxide (CO2) emissions.

The FAZ reportedly said the level was seen as very likely in Brussels where the European Union executive is due to adopt regulations on 19 December on how to enforce an average limit of 120g of CO2 per km by 2012 - part of the bloc's ambitious strategy to combat climate change.

If carmakers were to exceed the target by, for example, an average 10 grams, the penalty could be around EUR12.5bn ($US18.36bn) per year, the FAZ said, according to the news agency. The FTD put the potential fines at EUR4-13bn.

The news agency noted that the weekly European Voice had earlier quoted German government sources as saying Brussels favoured charging carmakers EIR90 per gram and per car for excess emissions.

An EU source had said that was the highest of three possible levels being considered and EUR10 per gram was the lowest, the Reuters report added.

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