Information Bulletin 1—IRB Causality Guidelines

The following guidelines provide clarity on how the Industrial and Regional Benefits Directorate at Innovation, Science and Economic Development Canada assesses the IRB Eligibility Criteria related to causality.

Responsibility for causality demonstration: The responsibility for demonstrating causality lies with the IRB Contractor or its Eligible Parties, not the IRB Recipient.

Scope of causality: Given the large volume of defence procurements, Contractors or their Eligible Parties are often engaged in IRB planning and execution on several projects with IRB obligations. Therefore, causality may be demonstrated to a specific project, or more broadly to an IRB Contractor's obligations in general.

In addition, IRB activities should make good business sense to the IRB Contractor or its Eligible Party. Therefore, the causality provision does not require that the IRB obligation be the IRB Contractor's only decision-making factor. However, the IRB Contractor or its Eligible Party must show the link between Canada's IRB Policy and their decisions related to the IRB activity.

Detailed causality statement: IRB Contractors or their Eligible Parties must demonstrate causality beyond generic statements on the IRB transaction sheet. They must provide comprehensive and detailed statements on causality, which outlines the details involved in their decision about a business activity, and a detailed timeline of events related to these details.

Evidence supporting causality statement: The IRB Directorate is looking for documentary evidence that links decisions regarding the IRB transaction to the IRB Contractor's obligation. This documentation may include, but is not limited to: internal emails, official correspondence, meeting notes, corporate presentations or other complete or redacted documents. IRB Contractors or their Eligible Parties should provide as much detailed supporting documentation as possible at the time of transaction submission that supports the statement on causality.

Acceptance: Wherever possible, IRB Managers will confirm causality prior to a proposed IRB transaction being accepted into the contract. In the case of competitive bid situations where discussions are not possible during the evaluation phase, IRB Managers will seek evidence of causality as soon as possible, and within one year, after contract award.

Reporting and verification: IRB Contractors should note that all IRB transactions are subject to annual reporting and verification before IRB credits are confirmed. If new information arises during verification that seriously calls into question the causality of an IRB transaction, the IRB Manager will review and investigate the causality claim.

For further guidance, please see Annex A for more details on how the IRB Directorate assesses causality. Definitions for many terms used above can be found on the IRB Directorate's online Glossary of Terms.

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