ABSTRACT
In the establishment of its regional emissions trading scheme (the EU ETS), the European Union has proposed a Linking Directive which will enable the inclusion of credits from Clean Development Mechanism (CDM) and Joint Implementation (JI) projects to meet commitments under the scheme. The EU ETS represents the first major regulatory step to incorporate the Kyoto Protocol’s flexible mechanisms into a domestic emissions trading framework. However, the ability to utilize credits from such projects will be dependent on the host country of a CDM or JI project having in place an appropriate legal framework to implement the project in accordance with the Kyoto Protocol, the Marrakesh Accords and the international climate change rules as they are developed and refined. In the case of CDM projects, this requires the establishment of a Designated National Authority (DNA) by the host country government, which will be responsible for authorizing participation in CDM projects and confirming that they meet the sustainable development criteria for that country. 1
