Getting Started: Initiating Your IRC

In the coming weeks, Canadian securities regulators are expected to publish the final version of National Instrument 81-107 Independent Review Committee for Investment Funds, substantially in the form published for comment in May 2005. This Practice Bulletin discusses the work that can be done now in anticipation of NI 81-107 becoming effective later this year. Fund managers should use the time before the rule becomes effective to review their businesses and relationships in order to identify possible conflicts of interest. Managers should also develop the IRC’s mandate and charter and ensure that written policies and procedures exist to manage conflicts of interest.

You can agree on a broader mandate for your IRC than the minimum conflict of interest oversight mandate required by NI 81-107. For example, an IRC could provide general advice, monitor the administration and management of the funds or act as an audit committee. When considering an expanded mandate,