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By Suadad al-Salhy
BAGHDAD (Reuters) - Iraq's parliament failed on Wednesday to agree on a law that will determine how the next election is run, raising fears of delays in a vote that could consolidate democracy after years of war.
The United Nations envoy to Iraq, Ad Melkert, said further delays in passing the law may call into doubt not only the January 16 election date, but also the credibility of the result.
"It is the collective responsibility of members of parliament to now rise to the occasion and be ready to account to the Iraqi people, who expect to exercise their right to express their preference in the upcoming elections," he said.
The election will be a critical test as Iraq emerges from more than six years of sectarian conflict unleashed by the U.S. invasion in 2003, ahead of a full U.S. withdrawal by end-2011.
"This situation is so embarrassing," said Faraj al-Haidari, head of the electoral commission. He said the body could wait at most another week before the election date would be in doubt.
A Pentagon official said President Barack Obama's timetable for drawing down U.S. troop numbers next year may be changed if the parliamentary poll is postponed.
On Tuesday, Obama urged Iraq to complete the election law.
Agreement over the framework for the election was initially thwarted by a row over what kind of voting system to use: open lists, under which voters can pick individual candidates, or closed lists, under which they can only pick parties.
This week the dispute has focussed on how votes should be distributed in the contested city of Kirkuk -- a point of tension between minority Kurds and Iraq's majority Arabs.
Kurds view Kirkuk as their ancestral home and want it included in their semi-autonomous northern enclave. Arabs, who were encouraged by former dictator Saddam Hussein to settle in Kirkuk to dilute Kurdish influence, oppose such a move.
Parliament referred the Kirkuk dispute to a council made of Shi'ite Prime Minister Nuri al-Maliki, President Jalal Talabani, a Kurd, the two vice-presidents and other political leaders.
"The political council will present us with a political solution that all the political parties will agree on," said Ayad al-Samarai, speaker of parliament and a top Sunni lawmaker.
"We still have time until Tuesday or Wednesday. We are optimistic. The election will take place on the scheduled date."
While political insiders said that Kirkuk might just be a convenient smokescreen for those opposed to other aspects of the election law, such as open lists, Shi'ite parties insisted the dispute was essentially between Sunni Arabs, Turkmen and Kurds.
"What's happened with the election law is unacceptable," said Kamal al-Saadi of Maliki's Dawa party. "Parliament has become the problem instead of part of the solution, and we should hurry to fix this problem through the election."
The Shi'ite-led alliance, which has dominated Iraq since the last election in 2005, has unravelled, and the January poll will primarily pit Maliki against his former Shi'ite Muslim partners.
Open lists are viewed as likely to benefit Maliki, who is seeking credit for a sharp drop in overall violence and faces a stiff contest against his main rivals, a coalition led by the powerful Supreme Islamic Iraqi Council.