The New Caledonian Congress has decided to set up a special commission tasked with creating a common flag to express the territory's identity in line with the 1998 Noumea Accord.
The decision comes amid political tensions over the practice by the French state and most town halls in New Caledonia to fly both the pro-independence Kanak flag and the French tricolore.
The plan for such a commission dates back to April and is in the main the idea of the Caledonia Together Party which has been campaigning against the two-flag solution.
The party has brought down the collegial government four times last year in protest.
A Future Together politician, Didier Leroux, has told the local newspaper that Caledonia Together's involvement in the commission will help extinguish the fire which it has lit.
The Labour Party is the only party opposed to the commission, saying it is superfluous as nothing will come out by the end of its mandate in 2014.
Although the Noumea Accord provides for a common flag, Paris accepted a 2010 suggestion to fly the two flags