IV. The Kyoto Mechanism
1. Emissions Trading
The main objective of emissions trading is to minimize the cost of meeting the country’s target set of emissions. The Article 17 and the paragraphs 3.10 and 3.11 of the Kyoto Protocol discuss about the emissions trading.
Article 17:
"The Conference of the Parties shall define the relevant principles, modalities, rules and guidelines, in particular for verification, reporting and accountability for emissions trading. The Parties included in Annex B may participate in emissions trading for the purposes of fulfilling the commitments under Article 3. Any such trading shall be supplemental to domestic actions for the purpose of meeting quantified emission limitation and reduction commitments under that article."