This second annual report of the administrator of the international transaction log (ITL) provides information to the Conference of the Parties serving as the meeting of the Parties to the Kyoto Protocol (COP/MOP) on progress in implementing the ITL from November 2005 to October 2006. The report provides information on progress in the development of the ITL software, establishment of the ITL infrastructure and facilitation of cooperation with registry system administrators. The COP/MOP, by its decision 12/CMP.1, requested the Subsidiary Body for Implementation (SBI) to consider, at its future sessions, the annual reports of the administrator of the ITL. The SBI may wish to take note of the information contained in this report and provide guidance to the secretariat and Parties, as necessary, concerning the implementation of registry systems.