Article 6.1 "For the purpose of meeting its commitments under Article 3, any Party included in Annex I may transfer to, or acquire from, any other such Party emission reduction units resulting from projects aimed at reducing anthropogenic emissions by sources or enhancing anthropogenic removals by sinks of greenhouse gases in any sector of the economy…"

The Kyoto Protocol specifies greenhouse gas (GHG) emission reduction targets for 38 industrialized countries, including 11 countries in Central and Eastern Europe. The Joint Implementation (JI) mechanism, outlined in Article 6 of the Protocol, allows these countries to work together to meet their targets. Recognizing that the economic costs of reductions among industrialized countries could vary widely, the Protocol allows these countries to jointly implement emissions reduction projects, with the investing country then be able to "credit" the reductions against their own reduction obligations. For example, Japan (through the government or a company) could invest in an emissions reduction project in Russia then use the credits to offset its national reduction target.

Emissions reduction projects under JI may only be implemented between industrialized countries with emissions limitation commitments. Under the Kyoto Protocol, the total GHG emissions of each industrialized country would be limited according to their emission targets. Countries subject to these targets would be allocated a specified number of emission units. Because the reductions generated by a JI project helps the host country reach its emissions target, the Article 6 credits ("emission reduction units" or ERUs) represent a portion of that country's allowance under the Protocol. Therefore, credits awarded for JI projects are subtracted from the host country's allowable emissions and added to the allowable emissions total of the investing country.

COP-7 and the Marrakesh Accords

Under the Marrakesh Accords, governments adopted a package of decisions on all the cooperative mechanisms, including recommendations for COP/MOP-1. The Protocol’s provisions on the cooperative mechanisms were expanded by the Marrakesh Accords, which include a decision setting out the principles, nature and scope of all three mechanisms, individual decisions containing operational rules for joint implementation, the CDM and emissions trading, and a further decision setting out a system of registries.

The Marrakesh Accords recognize that the Protocol has not created any "right, title or entitlement" to emit and calls on Annex I Parties to implement domestic action to reduce emissions, in a manner conducive to narrowing per capita differences between developed and developing countries. The Accords do not impose any concrete limits on the extent to which the mechanisms may be used to meet emission targets. However, Annex I Parties show in their national communications that their use of the mechanisms is "supplemental to domestic action" and constitutes "a significant element" of their efforts to achieve their targets.

Under the Accords, JI projects must have the approval of all Parties involved, and must lead to emission reductions or removals that are additional to any that would have occurred without the project. Sink projects must conform to the Protocol’s wider rules on the land use, land-use change and forestry sector. Annex I Parties are to refrain from using ERUs generated from nuclear energy to meet their targets. Projects starting from the year 2000 that meet the above rules may be listed as joint implementation projects. However, ERUs may only be issued in relation to periods from 2008 onwards. There are two possible procedures for JI project:

Track One: the first procedure applies when the host Party fully meets all the eligibility requirements related to methodological and reporting obligations under the Protocol. The host Party may then apply its own project procedures to projects. It may also issue ERUs and transfer them to the investing Party.

Track Two: the second procedure applies if the host Party does not meet all the eligibility requirements. In such cases, the amount of ERUs generated by a project must be verified under a procedure supervised by the Article 6 Supervisory Committee, which will be established by COP/MOP 1. This allows JI projects to begin operation before the host Party meets all the eligibility requirements. However, the host Party must meet several of requirements related to the establishment of its assigned amount and its national registry before it may issue and transfer ERUs.

Under track two, the Article 6 supervisory committee will accredit independent entities to ensure, on the basis of project design documents, that projects have an appropriate baseline, on which basis the emission reductions or removals will be calculated, and monitoring plan. This independent entity will determine the emission reductions that may be issued by the host Party as ERUs. JI was not debated at the Sixteenth Sessions of the Subsidiary Bodies.

For more information on Joint Implementation, see the UNFCCC Secretariat’s Issue Brief on the Kyoto Protocol mechanisms: "Joint implementation," clean development mechanism and emissions trading.