The constitutional affairs committee was supposed to vote on the report, 'transparency, accountability and integrity in the EU institutions', in Strasbourg on Monday.
It was postponed indefinitely after centre right members of the committee joined forces with Liberals and Social Democrat deputies.
The vote was put off without setting a new date, after some committee members raised opposition to some of the report's main demands, including a ban on MEPs taking "lobby side jobs."
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The decision comes despite thousands of citizens having written to committee members demanding "more transparency and integrity" in EU decision making.
German Greens/EFA group MEP Sven Giegold, rapporteur on the file, was highly critical of those members who pushed for a postponement.
He told this website, "Some MEPs may try to escape the will of voters but citizens won't allow that for long. The postponement can't do away with either the majority of MEPs in the committee or those citizens who support more transparency and sanctioning of conflicts of interest.
"The longer MEPs try to stop the democratic decision of the majority, the more citizens will get disappointed of them. I'm concerned though that the blockade might threaten the good name of Parliament."
He said that under his recommendations, lobbyists would be still free to choose not to register on the EU's transparency register, "but MEPs could make that a very unattractive choice."
The report calls for a "cooling-off" period for MEPs of 18 months, during which former members would have to notify Parliament of any occupation they intend to take up after stepping down from their MEP posts.
It also says deputies would only be allowed to meet lobbyists who are signed up to the transparency register.
Members would additionally be obliged to declare any remuneration they earn from outside activities and be banned from holding "side jobs as or having remunerated arrangements with a representative of special interests."
Myriam Douo, transparency and better regulation campaigner with Friends of the Earth Europe, told this website, "The report contains many steps towards transparency and the postponement is outrageous given the fact that all the shadow rapporteurs had committed to vote on Monday and waited until the last minute to ask for a postponement.
"This is not only an own-initiative report but has to be put into a broader perspective: a reform of Parliament's rules of procedure is coming up and the postponement of the vote prevents any element of the Giegold report to be taken on board in that reform, as the deadline for amendments will be passed before the next opportunity for a vote (29 September)."
Campaign group ALTER-EU, of which Friends of the Earth Europe is a member, together with Transparency International and Democracy International, launched an 'email your MEP' action ahead of the vote on the Giegold report.
"Thousands of people all across Europe mobilised so their MEPs would take a clear stand on transparency. A postponement of the vote is clearly disregarding this call," added Douo.