LONDON (Reuters) - A global trading scheme is the most effective means of cutting carbon emissions in the shipping sector, five shipping industry associations said in a study.

Shipping and aviation are the only industry sectors not regulated under the Kyoto Protocol, which sets targets for greenhouse gas emissions by rich countries from 2008-12.

The seaborne sector accounts for nearly three percent of global carbon dioxide (CO2) emissions and pressure has grown for cuts ahead of December's climate change summit in Copenhagen.

The national ship industry associations of Australia, Belgium, Norway, Sweden and the UK last week jointly launched a discussion paper arguing that a cap and trade scheme was best for the whole industry.

"We firmly believe that a trading solution is the right answer," Jan Kopernicki, vice president of the UK Chamber of Shipping, told a news conference.

Carbon markets allow polluters to buy rights to emit greenhouse gases such as carbon dioxide and are often seen as more politically acceptable than carbon taxes.

Under cap and trade schemes, companies or countries face a carbon limit. If they exceed their limit they can buy allowances from other polluters which stay under their cap.

Robert Ashdown, head of the UK Chamber of Shipping's technical division, estimated an emission trading scheme would cost the seaborne industry 5 billion euros ($7.39 billion) to 6 billion euros a year, depending on the price of carbon. The proposals presented said the trading scheme should be determined by a 100 percent auctioning process of credits.

It offered two options for the mechanism — the first would be treat shipping as a country in its own right which would mean the sector would be given a specific amount of credits.

The other option presented would allow for the number of credits earmarked would be determined by the number of sales of bunker fuel sold by governments at auction to shipping firms. The proposals did not set targets.

"We think targets are for governments to set. What we set is a method by which we will achieve those targets," Ashdown told Reuters.

Kopernicki said they were "happy to have a challenging target" for CO2 cuts in shipping at Copenhagen.

"It would be helpful though ... if there was a nudge towards a trading solution already at Copenhagen because it would accelerate discussion in the shipping industry," he said.

Delegates from member state countries of the UN's shipping agency the International Maritime Organisation in July approved non-compulsory technical and operational measures to reduce greenhouse emissions from ships. Environmental groups argue the measures did not go far enough given opposition from China and India.

UK Chamber of Shipping President Jesper Kjaedegaard said some shipping nations and industry associations might have "different ideas" to the proposals presented.

"We can no longer take an ostrich approach. We have to be part of the solution," he told Reuters.