The second annual report of the Paris Agreement Implementation and Compliance Committee covers activities undertaken between 30 October 2020 and 18 August 2021. The report provides a summary of the Committee’s activities and performance during the reporting period and progress in developing its draft rules of procedure for consideration and adoption by the Conference of the Parties serving as the meeting of the Parties to the Paris Agreement at its third session. Annex I presents the current composition of the Committee. Annex II contains the draft rules of procedure of the Committee as agreed by the Committee at its 5^th meeting.