I 
110TH CONGRESS 
2D SESSION 
H. R. 6316 
To reduce global greenhouse gas emissions through the creation of a domestic 
carbon market and international trade measures, and to direct the rev-
enue therefrom to public interests. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 19, 2008 
Mr. DOGGETT (for himself, Mr. BLUMENAUER, Mr. VAN HOLLEN, Mr. EMAN-
UEL, Mr. LARSON of Connecticut, Ms. DELAURO, Mr. GEORGE MILLER 
of California, Ms. SLAUGHTER, Mr. BRADY
of Pennsylvania, Ms. 
WASSERMAN SCHULTZ, Mr. LEWIS of Georgia, Mr. MCDERMOTT, Mr. 
OLVER, Mr. HOLT, Mr. STARK, Ms. BERKLEY, Ms. SCHWARTZ, Mr. 
CROWLEY, Mr. MCNULTY, Mr. MEEK of Florida, Mr. MORAN of Virginia, 
Mr. PASCRELL, Mr. THOMPSON of California, Mr. CONYERS, Mrs. JONES 
of Ohio, Mr. ACKERMAN, Mr. BISHOP of New York, Mr. CAPUANO, Ms. 
CASTOR, Mr. CHANDLER, Ms. CLARKE, Mr. CLEAVER, Mr. COHEN, Mr. 
COURTNEY, Mr. DAVIS of Illinois, Mr. ELLISON, Mr. FARR, Mr. FILNER, 
Mr. GUTIERREZ, Mr. HALL of New York, Mr. HARE, Mr. HINCHEY, Ms. 
HIRONO, Mr. HONDA, Mr. ISRAEL, Mr. JACKSON of Illinois, Ms. JACK-
SON-LEE of Texas, Ms. EDDIE BERNICE JOHNSON of Texas, Mr. JOHN-
SON of Georgia, Mr. KENNEDY, Mr. KLEIN of Florida, Mr. KUCINICH, 
Ms. LEE, Ms. ZOE LOFGREN of California, Mrs. MALONEY of New York, 
Mr. MCGOVERN, Ms. MOORE
of Wisconsin, Mr. NADLER, Mrs. 
NAPOLITANO, Ms. NORTON, Mr. PAYNE, Ms. LORETTA SANCHEZ of Cali-
fornia, Mr. SCHIFF, Mr. SESTAK, Mr. SHERMAN, Mrs. TAUSCHER, Ms. 
TSONGAS, Ms. WATERS, Ms. WATSON, Mr. WELCH of Vermont, Mr. 
WEXLER, Ms. WOOLSEY, Mr. WU, Mr. YARMUTH, Mr. THOMPSON of 
Mississippi, Mr. HASTINGS of Florida, Mr. GRIJALVA, Mr. FATTAH, and 
Mr. DELAHUNT) introduced the following bill; which was referred to the 
Committee on Ways and Means, and in addition to the Committees on 
Energy and Commerce, Foreign Affairs, Science and Technology, Finan-
cial Services, Education and Labor, Natural Resources, Agriculture, and 
Transportation and Infrastructure, for a period to be subsequently deter-
mined by the Speaker, in each case for consideration of such provisions 
as fall within the jurisdiction of the committee concerned 
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A BILL 
To reduce global greenhouse gas emissions through the cre-
ation of a domestic carbon market and international 
trade measures, and to direct the revenue therefrom to 
public interests. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Climate Market, Auction, Trust & Trade Emissions Re-
duction System Act of 2008’’ or the ‘‘Climate MATTERS 
Act of 2008’’. 
(b) TABLE OF CONTENTS.—The table of contents of 
this Act is as follows: 
Sec. 1. Short title; table of contents. 
Sec. 2. Purposes. 
TITLE I—GLOBAL COOPERATION 
Subtitle A—General Provisions 
Sec. 101. Definitions. 
Subtitle B—International Reserve Allowances 
Sec. 111. International reserve allowance program. 
Sec. 112. Adjustment of international reserve allowance requirements. 
Sec. 113. International Climate Change Commission. 
Sec. 114. Determinations of comparable action. 
Sec. 115. International agreements. 
TITLE II—REVENUE PROVISIONS 
Sec. 201. Issuing, auctioning, and administering emissions allowances. 
TITLE III—CITIZEN PROTECTION AND DEFICIT REDUCTION 
TRUST FUNDS 
Subtitle A—Establishment of Trust Funds 
Sec. 301. Establishment of citizen protection and deficit reduction trust funds. 
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Subtitle B—Citizen Protection Programs 
Sec. 310. Definitions. 
PART 1—CONSUMER ASSISTANCE 
Sec. 311. Allocation of account funds. 
Sec. 312. Climate change rebate program. 
Sec. 313. Healthy families fund. 
PART 2—INVESTMENT IN NATURAL RESOURCE ADAPTATION 
Sec. 321. Definitions. 
Sec. 322. Adaptation fund. 
PART 3—EARLY ACTION 
Sec. 331. Early action. 
PART 4—STATE AND TRIBAL ACTION 
Sec. 341. Allocation for energy savings. 
Sec. 342. Allocation for States with programs that exceed Federal emission re-
duction targets. 
Sec. 343. General allocation. 
PART 5—DOMESTIC AGRICULTURE AND FORESTRY 
Sec. 351. Allocation. 
Sec. 352. Agricultural and forestry greenhouse gas management research. 
Sec. 353. Distribution. 
PART 6—INTERNATIONAL FORESTRY 
Sec. 361. Findings. 
Sec. 362. Definition of deforestation reduction activities. 
Sec. 363. Allocation. 
Sec. 364. Quality criteria for deforestation reduction activities. 
Sec. 365. Eligibility for deforestation reduction activities. 
Sec. 366. Reviews and discount. 
PART 7—ENERGY EFFICIENCY 
Sec. 371. Allocation. 
Sec. 372. Distribution. 
Sec. 373. Use. 
Sec. 374. Reporting. 
PART 8—ALTERNATIVE TRANSPORTATION 
Sec. 381. Grants to provide for additional and improved public transportation 
service. 
Sec. 382. Grants for construction of new public transportation projects. 
Sec. 383. Grants for transportation alternatives and travel demand reduction 
projects. 
Sec. 384. Technical capacity and standards. 
Sec. 385. Study and standards. 
Sec. 386. Condition for receipt of funds. 
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TITLE IV—EMISSIONS DETERMINATIONS AND MISCELLANEOUS 
Sec. 401. Definitions. 
Sec. 402. Federal Greenhouse Gas Registry, emissions determination, and un-
covered sector emissions. 
Sec. 403. Paramount interest waiver. 
Sec. 404. Administrative procedure and judicial review. 
Sec. 405. Retention of State authority. 
Sec. 406. Tribal authority. 
Sec. 407. Authorization of appropriations. 
SEC. 2. PURPOSES. 
The purposes of this Act are— 
(1) to establish the core of a Federal program 
that will reduce United States greenhouse gas emis-
sions substantially enough between 2008 and 2050 
to avert the catastrophic impacts of global climate 
change; 
(2) to raise revenue to be used for positive envi-
ronmental and social purposes to offset the effects of 
climate change; and 
(3) to accomplish that purpose while preserving 
robust growth in the United States economy, cre-
ating new jobs, and avoiding the imposition of hard-
ship on United States citizens. 
TITLE I—GLOBAL COOPERATION 
Subtitle A—General Provisions 
SEC. 101. DEFINITIONS. 
In this title: 
(1) ADMINISTRATOR.—The term ‘‘Adminis-
trator’’ means the Administrator of the Environ-
mental Protection Agency. 
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(2) BASELINE EMISSIONS LEVEL.— 
(A) COVERED
GOODS.—With respect to 
covered goods of a WTO participant, the term 
‘‘baseline emissions level’’ means, as determined 
by the Commission, the total average annual 
greenhouse gas emissions attributed to a cat-
egory of covered goods of the WTO participant 
during the period beginning on January 1, 
2010, and ending on December 31, 2012, based 
on— 
(i) relevant data available for that pe-
riod; and 
(ii) to the extent necessary with re-
spect to a specific category of covered 
goods, economic and engineering models 
and best available information on tech-
nology performance levels for the manufac-
ture of that category of covered goods. 
(B) WTO PARTICIPANTS.—With respect to 
a WTO participant, the term ‘‘baseline emis-
sions level’’ means, as determined by the Com-
mission, the total annual nationwide greenhouse 
gas emissions attributed to the WTO partici-
pant during the period beginning on January 1, 
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2010, and ending on December 31, 2012, based 
on best available information. 
(3) BEST AVAILABLE INFORMATION.—The term 
‘‘best available information’’ means— 
(A) all relevant data that is available for 
the particular period; and 
(B) to the extent necessary, economic and 
engineering models, best available information 
on technology performance levels, and any other 
useful measure or technique for estimating the 
emissions from such emissions activities. 
(4) CARBON DIOXIDE EQUIVALENT.—The term 
‘‘carbon dioxide equivalent’’ means, for each green-
house gas, the quantity of the greenhouse gas that 
the Administrator determines makes the same con-
tribution to global warming as 1 metric ton of car-
bon dioxide. 
(5) COMMISSION.—The term ‘‘Commission’’ 
means the International Climate Change Commis-
sion established under section 113. 
(6) COMPARABLE
ACTION.—The term ‘‘com-
parable action’’ means any greenhouse gas regu-
latory programs, requirements, and other measures 
adopted by a WTO participant that, in combination, 
are comparable in effect to actions carried out by 
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the United States, through Federal, State, and local 
measures, to limit greenhouse gas emissions pursu-
ant to this Act and the amendments made by this 
Act, as determined by the Commission under section 
114. 
(7) COMPLIANCE YEAR.—The term ‘‘compliance 
year’’ means each calendar year for which the re-
quirements of this title apply to a category of cov-
ered goods of a covered WTO participant that is im-
ported into the United States. 
(8) COVERED
WTO
PARTICIPANT.—The term 
‘‘covered WTO participant’’ means a WTO partici-
pant that is included on the covered list prepared 
under section 111 (b)(3). 
(9) COVERED GOOD.—The term ‘‘covered good’’ 
means a good that (as identified by the Secretary, 
in consultation with the Administrator, by rule)— 
(A) is a primary product or a manufac-
tured item for consumption; 
(B) generates, in the course of the manu-
facture of the good, a substantial quantity of 
greenhouse gas emissions, including indirect 
greenhouse gas emissions; and 
(C) is closely related to a good the cost of 
production of which in the United States is af-
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fected by a requirement of this Act or the 
amendments made by this Act. 
(10) EMISSION ALLOWANCE.—The term ‘‘emis-
sion allowance’’ means an authorization to emit 1 
carbon dioxide equivalent of greenhouse gas. 
(11) ENTER; ENTRY.—The terms ‘‘enter’’ and 
‘‘entry’’ into the United States refer to the entry, or 
withdrawal from warehouse for consumption, in the 
customs territory of the United States. 
(12) GREENHOUSE
GAS.—The term ‘‘green-
house gas’’ means any of— 
(A) carbon dioxide; 
(B) methane; 
(C) nitrous oxide; 
(D) sulfur hexafluoride; 
(E) a perfluorocarbon; 
(F) a hydrofluorocarbon; or 
(G) any other anthropogenically-emitted 
gas that is determined by the Administrator, 
after notice and comment, to contribute to glob-
al warming to a non-negligible degree. 
(13) GREENHOUSE GAS EMISSIONS.—The term 
‘‘greenhouse gas emissions’’ means emissions of a 
greenhouse gas, including— 
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(A) stationary combustion source emissions 
emitted as a result of combustion of fuels in 
stationary equipment, such as boilers, furnaces, 
burners, turbines, heaters, incinerators, engines, 
flares, and other similar sources; 
(B) process emissions consisting of emis-
sions from chemical or physical processes other 
than combustion; 
(C) fugitive emissions consisting of inten-
tional and unintentional emissions from equip-
ment leaks, such as joints, seals, packing, and 
gaskets, or from piles, pits, cooling towers, and 
other similar sources; and 
(D) biogenic emissions resulting from bio-
logical processes, such as anaerobic decomposi-
tion, nitrification, and denitrification. 
(14) INDIRECT GREENHOUSE GAS EMISSIONS.— 
The term ‘‘indirect greenhouse gas emissions’’ 
means any greenhouse gas emissions resulting from 
the generation of electricity that is consumed during 
the manufacture of a good. 
(15) INTERNATIONAL RESERVE ALLOWANCE.— 
The term ‘‘international reserve allowance’’ means 
an allowance (denominated in units of metric tons of 
carbon dioxide equivalent) that is— 
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(A) purchased from a special reserve of 
emission 
allowances 
pursuant 
to 
section 
111(a)(2); and 
(B) used for purposes of meeting the re-
quirements of section 111. 
(16) MANUFACTURED
ITEM
FOR
CONSUMP-
TION.—The term ‘‘manufactured item for consump-
tion’’ means any good or product— 
(A) that is not a primary product; 
(B) that generates, in the course of its 
manufacture, a substantial amount of direct 
greenhouse gas emissions or indirect greenhouse 
gas emissions, including such emissions that are 
attributable to the inclusion of a primary prod-
uct in the manufactured item for consumption; 
and 
(C) for which the Commission determines 
that the application of an international reserve 
allowance requirement under section 111 to the 
particular category of goods or products is ad-
ministratively feasible and necessary to achieve 
the purposes of this title. 
(17) PERCENTAGE
CHANGE
IN
GREENHOUSE 
GAS EMISSIONS.—The term ‘‘percentage change in 
greenhouse gas emissions’’ means, as determined by 
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the Secretary, in consultation with the Adminis-
trator, the percentage by which greenhouse gas 
emissions on a nationwide basis in a WTO partici-
pant has decreased or increased (as the case may 
be) from the baseline emissions level of the WTO 
participant. The percentage change for a WTO par-
ticipant shall equal the quotient obtained by divid-
ing— 
(A) the amount of the decrease or increase 
in the total nationwide emissions for the WTO 
participant, as measured by comparing such 
total emissions for the relevant calendar year, 
to the baseline emissions level for the WTO 
participant; by 
(B) the baseline emissions level for the 
WTO participant. 
(18) PRIMARY PRODUCT.—The term ‘‘primary 
product’’ means— 
(A) iron, steel, aluminum, cement, bulk 
glass, paper pulp, chemicals, or industrial ce-
ramics; or 
(B) any other manufactured product 
that— 
(i) is sold in bulk for purposes of fur-
ther manufacture; and 
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(ii) generates, in the course of the 
manufacture of the product, greenhouse 
gas emissions and indirect greenhouse gas 
emissions that are comparable (on an 
emissions-per-dollar basis) to emissions 
generated in the manufacture of products 
by covered facilities in the industrial sec-
tor. 
(19) RETIRE AN ALLOWANCE.—To ‘‘retire’’ an 
allowance is to disqualify the allowance for any sub-
sequent use, regardless of whether the use is a sale, 
exchange, or submission of the allowance in satis-
fying a compliance obligation. 
(20) 
SECRETARY.—The 
term 
‘‘Secretary’’ 
means the Secretary of the Treasury. 
(21) SEQUESTRATION.—The term ‘‘sequestra-
tion’’ means the capture, permanent separation, iso-
lation, or removal of greenhouse gases from the at-
mosphere, as determined by the Secretary, after con-
sultation with the Administrator. 
(22) TRADE
AGREEMENT.—The term ‘‘trade 
agreement’’ means any agreement between the 
United States and one or more foreign countries 
providing for the reduction of tariff or nontariff bar-
riers, including the Agreement establishing the 
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World Trade Organization, done at Marrakesh on 
April 15, 1994. 
(23) U.S. CUSTOMS
AND
BORDER
PROTEC-
TION.—The term ‘‘U.S. Customs and Border Pro-
tection’’ means U.S. Customs and Border Protection 
of the Department of Homeland Security. 
(24) WTO PARTICIPANT.—The term ‘‘WTO 
participant’’ means a member of, or observer govern-
ment to, the World Trade Organization (WTO), 
other than the United States. 
Subtitle B—International Reserve 
Allowances 
SEC. 111. INTERNATIONAL RESERVE ALLOWANCE PRO-
GRAM. 
(a) ESTABLISHMENT.— 
(1) IN GENERAL.—The Secretary shall establish 
a program under which the Secretary, during the 1- 
year period beginning on January 1, 2014, and an-
nually thereafter, shall offer for sale to United 
States importers international reserve allowances in 
accordance with this subsection. 
(2) SOURCE.—International reserve allowances 
under paragraph (1) shall be issued from a special 
reserve of emission allowances that is separate from, 
and established in addition to, the quantity of emis-
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sion allowances established under section 9911 of 
the Internal Revenue Code of 1986. 
(3) PRICE.— 
(A) IN
GENERAL.—Subject to subpara-
graph (B), the Secretary shall establish, by 
rule, a methodology for determining the price of 
international reserve allowances for each com-
pliance year at a level that does not exceed the 
market price of emission allowances established 
under section 9911 of the Internal Revenue 
Code of 1986 for the compliance year. 
(B) MAXIMUM PRICE.—The price for an 
international reserve allowance under subpara-
graph (A) shall not exceed the clearing price for 
current compliance year allowances established 
at the most recent auction of allowances under 
section 9912 of the Internal Revenue Code of 
1986. 
(4) SERIAL NUMBER.—The Secretary shall as-
sign a unique serial number to each international re-
serve allowance issued under this subsection. 
(5) ADMINISTRATION
OF
SYSTEM.—The Sec-
retary may provide, by rule, for the administration 
of the system of international reserve allowances in 
a manner consistent with the carbon market estab-
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lished under subtitle L of the Internal Revenue Code 
of 1986. 
(6) REGULATED
ENTITIES.—International re-
serve allowances may not be submitted by persons 
subject to the allowance submission requirements of 
section 9901 or 9913 of the Internal Revenue Code 
of 1986 to comply with such allowance submission 
requirements. 
(7) PROCEEDS.—All proceeds from the sale of 
international reserve allowances under this sub-
section shall be allocated to a program that the Sec-
retary, in coordination with the Secretary of State, 
shall establish to mitigate the negative impacts of 
global climate change on disadvantaged communities 
in WTO participants. 
(b) WTO PARTICIPANT LISTS.— 
(1) IN GENERAL.—Not later than January 1, 
2015, and annually thereafter, the Secretary shall 
develop and publish in the Federal Register 2 lists 
of WTO participants, in accordance with this sub-
section. 
(2) EXCLUDED LIST.— 
(A) IN GENERAL.—The Secretary, in con-
sultation with the Commission, shall identify 
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and publish in a list, to be known as the ‘‘ex-
cluded list’’— 
(i) each WTO participant determined 
by the Commission under section 114(a) to 
have taken action comparable to that taken 
by the United States to limit the green-
house gas emissions of the WTO partici-
pant; 
(ii) each WTO participant that has 
entered into an agreement with the United 
States under subsection (a) or (b) of sec-
tion 115; 
(iii) each WTO participant the share 
of total global greenhouse gas emissions of 
which is below the de minimis percentage 
described in subparagraph (B); and 
(iv) each WTO participant that the 
United Nations has identified as among 
the least developed of developing countries. 
(B) DE
MINIMIS
PERCENTAGE.—The de 
minimis percentage referred to in subparagraph 
(A) is a percentage of total global greenhouse 
gas emissions of not more than 0.5, as deter-
mined by the Commission, for the most recent 
calendar year for which emissions and other rel-
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evant data is available, taking into consider-
ation, as necessary, the annual average defor-
estation rate during a representative period for 
a WTO participant that is a developing coun-
try. 
(3) COVERED LIST.— 
(A) IN GENERAL.—The Secretary, in con-
sultation with the Commission, shall identify 
and publish in a list, to be known as the ‘‘cov-
ered list’’, each WTO participant the covered 
goods of which are subject to the requirements 
of this section. 
(B) REQUIREMENT.—The covered list shall 
include each WTO participant that is not in-
cluded on the excluded list under paragraph 
(2). 
(4) 
PRESIDENTIAL
AUTHORITY.—Notwith-
standing paragraphs (2) and (3), the President may 
require the Commission to place a WTO participant 
on the excluded list or covered list if the President 
determines such action is necessary to protect essen-
tial security interests of the United States. 
(c) PUBLICATION OF COVERED GOODS.—The Sec-
retary, in consultation with the Commission, shall publish 
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a list of all covered goods of each WTO participant on 
the covered list. 
(d) WRITTEN DECLARATIONS.— 
(1) IN GENERAL.—Effective beginning January 
1, 2015, a United States importer of any covered 
good shall, as a condition of the entry of the covered 
good into the United States, submit to the Secretary 
and the appropriate office of U.S. Customs and Bor-
der Protection a written declaration, with respect to 
each such entry, that meets the requirements of this 
subsection. 
(2) CONTENTS.—A written declaration under 
paragraph (1) shall contain a statement that— 
(A) the applicable covered good is accom-
panied by a sufficient number of international 
reserve allowances, as determined under sub-
section (e); or 
(B) the covered good is from a WTO par-
ticipant on the excluded list under subsection 
(b)(2). 
(3) DOCUMENTATION AND DEPOSIT.—If an im-
porter does not certify that the covered good is a 
product of a WTO participant on the excluded list 
under paragraph (2)(B), the written declaration for 
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such good shall include the following supporting doc-
umentation and deposit: 
(A) The name of each WTO participant in 
which the covered good was manufactured or 
processed. 
(B) A brief description of the extent to 
which the covered good was manufactured or 
processed in each WTO participant identified 
under subparagraph (A). 
(C) An estimation of the number of inter-
national reserve allowances that are required 
for entry of the covered good into the United 
States under subsection (e). 
(D) At the election of the importer, the de-
posit of— 
(i) international reserve allowances in 
an amount equal to the estimated number 
required for entry under subparagraph (C); 
or 
(ii) a bond, other security, or cash in 
an amount that covers the purchase of the 
estimated number of international reserve 
allowances under subparagraph (C). 
(4) FINAL ASSESSMENT.— 
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(A) IN
GENERAL.—Not later than 6 
months after submission of the written declara-
tion and entry of the covered good under para-
graph (1), the Secretary shall make a final as-
sessment of the international reserve allowance 
requirement for the covered good under this 
section. The final assessment shall specify the 
total number of international reserve allowances 
that are required for entry of the covered good 
into the United States and whether the amount 
of the deposit under paragraph (3)(D) is lower 
or higher than the final assessment.. 
(B) RECONCILIATION.— 
(i) ALLOWANCE DEPOSIT.—U.S. Cus-
toms and Border Protection shall promptly 
reconcile the final assessment with the 
amount of international reserve allowances 
deposited under paragraph (3)(D)(i). If 
international reserve allowances are depos-
ited in an amount that is more than the 
final assessment, U.S. Customs and Bor-
der Protection shall refund the excess 
amount. If such allowances are deposited 
in an amount that is less than final assess-
ment, the importer shall tender within 14 
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days sufficient allowances to satisfy fully 
the final assessment. 
(ii) BOND, SECURITY, OR CASH DE-
POSIT.—If an importer has submitted a 
bond, security, or cash deposit under para-
graph (3)(D), U.S. Customs and Border 
Protection shall use the deposit to pur-
chase a sufficient number of international 
reserve allowances, as determined in the 
final assessment under subparagraph (A). 
To the extent that the deposit fails to 
cover the purchase of sufficient inter-
national reserve allowances, the importer 
shall submit such additional allowances to 
cover the shortfall of allowances. To the 
extent that the amount of the deposit is 
more than the amount of the final assess-
ment, U.S. Customs and Border Protection 
shall refund to the importer the unused 
portion of the deposit. 
(5) INCLUSION.—A written declaration under 
this subsection shall include the unique serial num-
ber of each international reserve allowance associ-
ated with the entry of the applicable covered good 
into the United States. 
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(6) FAILURE
TO
DECLARE.—A covered good 
that is not accompanied by a written declaration 
that meets the requirements of this subsection shall 
not be permitted to be entered into the United 
States. 
(7) CORRECTED DECLARATION.— 
(A) IN GENERAL.—If, after making a dec-
laration required under this subsection, an im-
porter has reason to believe that the declaration 
contains information that is not correct, the im-
porter shall provide a corrected declaration by 
not later than 30 days after the date of dis-
covery of the error, in accordance with subpara-
graph (B). 
(B) METHOD.—A corrected declaration 
under subparagraph (A) shall be in the form of 
a letter or other written statement to the Sec-
retary and to the office of U.S. Customs and 
Border Protection to which the original declara-
tion was submitted. 
(e) QUANTITY OF ALLOWANCES REQUIRED.— 
(1) METHODOLOGY.— 
(A) IN GENERAL.—The Secretary shall es-
tablish, by rule, a method for calculating the re-
quired number of international reserve allow-
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ances that a United States importer must sub-
mit, together with a written declaration under 
subsection (d), for each category of covered 
goods of each covered WTO participant. 
(B) FORMULA.—The Secretary shall de-
velop a general formula for calculating the 
international reserve allowance requirement 
that applies, on a per unit basis, to each cov-
ered good of a covered WTO participant that is 
imported during each compliance year. 
(2) GENERAL FORMULA.—The international al-
lowance reserve requirement, as described in para-
graph (1), for a compliance year is equal to the 
product obtained by multiplying— 
(A) the national greenhouse gas intensity 
rate for each category of covered goods of each 
covered WTO participant for the compliance 
year, as determined by the Secretary under 
paragraph (3), by 
(B) the allowance adjustment factor for 
the industry sector in the WTO participant that 
manufactured the covered goods that entered 
into the United States, as determined by the 
Secretary under paragraph (4), by 
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