One of the key issues for "Joint Implementation" is how to define a plausible baseline, a necessary benchmark for calculating net Greenhouse Gases (GHGs) emission reductions through a comparative approach. Based on a thorough case study of the China-Japan Coke Dry Quenching (CDQ) project, the first approved pilot project in China under the "Activities Implemented Jointly" (AIJ) framework, the paper not only describes in detail the complete procedure of baseline definition of the case project, but also discusses its approach to baseline determination. Furthermore, cost-benefit analysis of GHGs mitigation is conducted according to the baseline. This empirical case study, based on real AIJ project data, will be beneficial for the development of future projects under Kyoto mechanisms such as "Clean Development Mechanism" and "Joint Implementation".