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Ch. 5, 6
IFM Delegation Rules
What can and cannot be delegated by ManCos and AIFMs — side by side
| Function | Can Be Delegated? | Key Condition | Non-Delegable? |
|---|---|---|---|
| Portfolio management | Yes | Only if risk management is NOT also delegated | No — but cannot co-delegate with risk management |
| Risk management | Yes | Only if portfolio management is NOT also delegated | No — but cannot co-delegate with portfolio management |
| Valuation function | Yes | Written agreement; delegate must be qualified; IFM remains responsible for NAV | No |
| Compliance function | Yes (partial) | IFM retains compliance oversight; charter and reporting remain with IFM | Partially — oversight cannot be delegated |
| Internal audit | Yes | Cannot combine internal audit with other control functions; IFM retains reporting line | No |
| AML/CTF tasks | Certain tasks yes | Written agreement; IFM remains CSSF point of contact and responsible party | CSSF contact/responsibility: no |
| IT / operations | Yes | BCP testing between IFM and delegate required; exit strategy documented | No |
| Setting general investment policy | No | N/A | Yes — must remain with IFM governing body |
| Determining risk profile | No | N/A | Yes — must remain with IFM |
| Interpreting risk analyses | No | N/A | Yes — interpretation and decisions stay with IFM |
| Conflicts of interest policy | No | N/A | Yes — setting up and managing the policy: non-delegable |
| Choosing the delegate | No | N/A | Yes — delegate selection is non-delegable (cannot be sub-delegated) |
| Monitoring delegated functions | No | N/A | Yes — oversight of delegates must stay with IFM |
📌 Data sourced from Lux Investment Funds 2025, Chapters 5, 6. Verify current requirements with CSSF at cssf.lu.