Their rationale is that large countries have more natural vegetation to absorb pollution, and more fields and forests to provide natural resources for the world. So they should be entitled to a larger ecological footprint than small, densely populated countries.
I welcome the concept of introducing equity and fairness into the Kyoto targets, but I think my idea of allocating per-capita emissions worldwide would accomplish the same purpose. The per-capita emissions, allocated worldwide and then aggregated for each nation, should be net emissions, so low-density countries will have the opportunity to use their forests etc. as a sink to reduce their emissions. Reduce emissions enough, and then the low density nation can sell part of its emission quota to other nations.
The presence of carbon sinks in low-density nations is/should be a double-edged sword, though. If a nation screws with its carbon sink, say by cutting down the trees, then it has added to the net emissions from the country. That should be part of the climate management picture.