(iii) the institutional capacity to re-
duce emissions from deforestation and for-
est degradation; 
(B) capped greenhouse gas emissions or 
otherwise established a credible national base-
line or emission reference baseline; 
(C) achieved national-level reductions of 
deforestation and degradation below an histor-
ical reference baseline, taking into consideration 
national circumstances and the average annual 
deforestation and degradation rates of the coun-
try during a period of at least five years; 
(D) implemented an emission reduction 
program for the forest sector; and 
(E) demonstrated those reductions using 
remote sensing technology, taking into consider-
ation relevant international standards. 
(2) PERIODIC REVIEW OF NATIONAL LEVEL RE-
DUCTIONS
IN
DEFORESTATION
AND
FOREST
DEG-
RADATION.—The Administrator, in consultation with 
the Secretary, shall periodically review and update 
the list of the names of countries included under 
paragraph (1). 
(3) 
CREDITING
AND
ADDITIONALITY.—A 
verified reduction in greenhouse gas emissions from 
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deforestation and forest degradation under a cap or 
resulting from a nationwide emissions reference sce-
nario described in paragraph (1)(B) shall be— 
(A) eligible for offset allowances; and 
(B) considered to satisfy the additionality 
criterion. 
(d) SUBNATIONAL LEVEL ACTIVITIES.—With respect 
to foreign countries other than the foreign countries de-
scribed in subsection (c), the Administrator shall recognize 
project scale international forest carbon activities as eligi-
ble for offset allowances, subject to the quality criteria for 
forest carbon activities described in subsection (b). 
(e) OTHER INTERNATIONAL FOREST CARBON AC-
TIVITIES.—An international forest carbon activity, other 
than a reduction in deforestation or forest degradation, 
shall be eligible for offset allowances under this section, 
subject to the eligibility requirements and quality criteria 
for forest carbon activities described in subsection (b) or 
other regulations promulgated pursuant to this section. 
(f) DISCOUNT.— 
(1) INITIAL DISCOUNT.—If, after the date that 
is 10 years after the date of enactment of this Act, 
the Administrator determines that a foreign country 
that, in the aggregate, generates greenhouse gas 
emissions accounting for more than 0.5 percent of 
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global greenhouse gas emissions has not capped 
those emissions, established an emissions reference 
scenario based on historical data, or otherwise re-
duced total forest emissions of that foreign country, 
the Administrator shall apply a discount to distribu-
tions of offset allowances to international forest car-
bon activities in that country under this section. 
(2) SUBSEQUENT TERMINATION.—If, after the 
date that is 15 years after the date of enactment of 
this Act, the Administrator determines that a for-
eign country that, in the aggregate, generates green-
house gas emissions accounting for more than 0.5 
percent of global greenhouse gas emissions has not 
capped those emissions, established an emissions ref-
erence scenario based on historical data, or other-
wise reduced total forest emissions of that foreign 
country, the Administrator shall cease distributions 
of offset allowances to international forest carbon 
activities in that country under this section. 
(g) FACILITY CERTIFICATION.—The owner or oper-
ator of a covered entity that submits an offset allowance 
generated under this section shall certify that the offset 
allowance has not been retired from use in any greenhouse 
gas emissions registry. 
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(h) MAXIMUM USE.—The regulations promulgated 
pursuant to this section shall ensure that offset allowances 
are not issued for sequestration or emission reductions 
that have been used or will be used by any other country 
for compliance with a domestic or international obligation 
to limit or reduce greenhouse gas emissions. 
(i) REVIEWS.—Not later than three years after the 
date of enactment of this Act and every five years there-
after, the Administrator, in consultation with the Sec-
retary, shall conduct a review of the activities undertaken 
pursuant to this section, including the effects of the activi-
ties on indigenous and forest-dependent peoples residing 
in affected areas. 
Æ 
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