It was already recognised in 1994 that the initial UNFCCC commitments would not be enough to halt the global increase in greenhouse gas emissions. On 11 December 1997, governments took a further step and adopted a protocol to the UNFCCC in the Japanese town of Kyoto. Building on the UNFCCC framework, the Kyoto Protocol sets legally binding limits on greenhouse gas emissions in industrialised countries and envisages innovative market-based implementation mechanisms aimed at keeping the cost of curbing emissions low.

The Protocol's major feature is that it has mandatory targets on greenhouse-gas emissions for the world's leading economies which have accepted it. These targets range from -8 per cent to +10 per cent of the countries' individual 1990 emissions levels "with a view to reducing their overall emissions of such gases by at least 5.2 per cent below existing 1990 levels in the commitment period 2008 to 2012". In almost all cases, even those set at +10 per cent of 1990 levels, the limits call for significant reductions in currently projected emissions. Future mandatory targets are expected to be established for "commitment periods" after 2012. These are to be negotiated well in advance of the periods concerned.

The targets cover emissions of the six main greenhouse gases, namely:

• Carbon dioxide (CO2);
• Methane (CH4);
• Nitrous oxide (N2O);
• Hydrofluorocarbons (HFCs);
• Perfluorocarbons (PFCs); and
• Sulphur hexafluoride (SF6)
  

Under the Kyoto Protocol, industrialised countries are required to reduce the emissions of six greenhouse gases (CO2, which is the most important one) on average by 5.2 % below the 1990 levels during the first "commitment period" from 2008 to 2012. There are no emission targets for developing countries.

A five-year commitment period was chosen rather than a single target year to smooth out annual fluctuations in emissions due to uncontrollable factors such as weather. International negotiations on a second commitment period under the Kyoto Protocol after 2012 started in 2005.

The six gases are to be combined in a "basket", with reductions in individual gases translated into "CO2 equivalents" that are then added up to produce a single figure.

Each country’s emissions target must be achieved by the period 2008-2012. It will be calculated as an average over the five years. "Demonstrable progress" towards meeting the target must be made by 2005.

Cuts in the three most important gases – carbon dioxide (CO2), methane (CH4), and nitrous oxide (N20) - will be measured against a base year of 1990 (with exceptions for some countries with economies in transition). Cuts in three long-lived industrial gases – hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulphur hexafluoride (SF6) - can be measured against either a 1990 or 1995 baseline. (A major group of industrial gases, chlorofluorocarbons, or CFCs, are dealt with under the 1987 Montreal Protocol on Substances that Deplete the Ozone Layer.)

Country	Target (1990** - 2008/2012)
EU-15*, Bulgaria, Czech Republic, Estonia, Latvia, Liechtenstein, Lithuania, Monaco, Romania, Slovakia, Slovenia, Switzerland	-8 %
US***	-7 %
Canada, Hungary, Japan, Poland	-6 %
Croatia	-5 %
New Zealand, Russian Federation, Ukraine	0
Norway	+1 %
Australia***	+8 %
Iceland	+10 %

The commitments will become legally binding once the Kyoto Protocol enters into force. The rules for entry into force demand that at least 55 Parties to the UNFCCC ratify the Protocol and that those include industrialised countries (Annex I countries) accounting for at least 55% of the CO2 emissions in 1990.

Thus far, more than 140 countries have ratified the Kyoto Protocol, so the first threshold has been attained. The Annex I countries among them represent nearly 62% of the CO2 emissions, so the second threshold has also been attained and the Kyoto Protocol entered into force in February 2005. The EU's share is 24.2%. On 31 May 2002, the EU and all its Member States ratified the Kyoto Protocol.

The ratification of Russia which is responsible for 17.4% of the global 1990 CO2 emissions made it possible for the Protocol's entry into force. The United States which are responsible for 36.1%, and thus are the worlds largest CO2 pollutant, withdrew from the Kyoto Protocol in early 2001.

On 31 May 2002, the European Union (EU) and all its Member States ratified the Kyoto Protocol. Under the Kyoto Protocol, the EU committed itself to reducing its greenhouse gases emissions by 8% during the first commitment period from 2008 to 2012. This target is shared between the Member States under a legally binding burden-sharing agreement, which sets individual emissions targets for each Member State.

The ten new member states which joined the EU in May 2004 all have ratified the Kyoto Protocol and have their own Kyoto targets of between 6% and 8%. Cyprus and Malta are treated as developing countries in the Kyoto Protocol and so do not have emission targets. The EU's 8% target only refers to the previous 15 Member States, and this did not change after enlargement.

The EU is at the forefront of international efforts to combat climate change and has played a key role in the development of the two major treaties addressing the issue, the United Nations Framework Convention on Climate Change (UNFCCC) and its Kyoto Protocol.