The German carmaker's admission in September 2015 that it used software to cheat U.S. diesel emission tests highlighted the laxness of the EU's own tests, prompting reforms. European Commission research shows inadequate testing has led to on-road emissions of toxic nitrogen oxides as high as 15 times the regulatory limit.
The new process, known as Real Driving Emissions (RDE), is designed to reflect everyday driving conditions and to narrow the disparity between road and laboratory test results.
Until now only laboratory tests have been used as the benchmark for assessing vehicle emissions, with carmakers employing a variety of strategies — such as taping up doors and windows — to produce better results than possible on the road.
Carmakers had lobbied for a three-year delay to the rules that will reduce the fuel-saving claims they can make for their vehicles, an industry paper seen by Reuters showed.
However, the European Automobile Manufacturers' Association (ACEA), whose members include BMW, Volkswagen and Fiat Chrysler, said in a statement on Thursday the more stringent rules "provide a more accurate basis for measuring a vehicle's fuel consumption and emissions."
"For the time being, diesel cars remain part of our lives and we must rebuild confidence in this technology," EU Industry Commissioner Elzbieta Bienkowska said in a statement on Thursday. "That is why having new and more reliable tests for new cars is essential."
No manufacturer other than Volkswagen has been found to have installed software solely aimed at masking emissions, but regulators in Britain and Germany say carmakers have made extensive use of other means to scale back pollution-controls, arguing they do so to protect engines.
The European Commission is also seeking an overhaul of how new car models are approved by member states and broader supervisory powers, including the ability to impose fines on carmakers, to better police the industry.
The new rules will apply for all new car models by September 2017 and will be phase in for all new vehicles by between September 2018 and 2019.