The United Arab Emirates (UAE) has implemented the In-Country Value (ICV) program to support the growth and sustainability of its industrial sector and boost the national economy. The ICV program, initiated by the Abu Dhabi National Oil Company (ADNOC), encourages local expenditure on manufacturing, products and services, investments, Emirati employment, and job creation.
Recently, The Ministry of Industry and Advanced Technology (MoIAT) has taken over the ICV certification process. In order to participate in the partnership with MoIAT, businesses must now complete an ICV assessment. This assessment will be used in the evaluation and award process of tenders.. The new strategy is procurement led and designed to increase MoIAT’s ICV contribution. In order to do this, they will be focusing on the selection of local suppliers, the development of UAE nationals, and the localization of critical functionalities in the oil and gas industry. By redirecting procurement spending into the national economy, the program aims to enhance the UAE’s manufacturing sector and promote economic diversification.
Understanding the National ICV Program
The National ICV Program was launched by the UAE Government to support the Ministry of Industry and Advanced Technology’s (MoIAT) mandate of improving the productivity and sustainability of the UAE’s industrial sector. The program focuses on strategic localization of supply chains, attracting foreign investments, diversifying the economy, creating job opportunities, contributing to GDP growth, enhancing spending on research and development (R&D), and enhancing the private sector’s contribution to the nation’s economy.
The program’s strategic partners include government entities and leading national companies in various industries. These partners, such as the Abu Dhabi Department of Economic Development (ADDED), Abu Dhabi National Oil Company (ADNOC), and Aldar Properties, collaborate to promote the program’s objectives. Other entities are also expected to join the program in the near future, further strengthening its impact on the UAE’s economy.
Importance of ICV Certification
ICV certification plays a crucial role in the National ICV Program, as it measures the contribution of goods, services, investments, and employment provided by businesses operating in the UAE. The ICV Certificate, issued by MoIAT, certifies the level of In-Country Value achieved by a company. It signifies the company’s commitment to supporting the local economy and demonstrates its eligibility to participate in tenders and business opportunities with MoIAT and other government entities.
Obtaining an ICV Certificate
To obtain an ICV Certificate in UAE, companies need to meet specific requirements set by the ICV program. The certification process involves several steps, such as:
- Issue Audited Financial Statements: Companies must provide audited financial statements prepared in accordance with International Financial Reporting Standards (IFRS) and signed by a licensed auditor from the UAE Ministry of Economy. These financial statements should not be older than two years from the certifying year, ensuring the transparency and reliability of the company’s financial reporting.
- Fill ICV Template: Companies are required to fill in the ICV template, a standardized form that records data on various aspects of their operations. The template captures information related to local sourcing, investment in the community, Emirati employment, and other elements that contribute to the growth of the local economy. It is essential for companies to adhere to the ICV program’s guidelines while completing the template.
- Evaluation by Certifying Bodies: The ICV template and supporting documentation are evaluated by authorized certifying bodies. These independent organizations have been granted permission by the ICV program to assess and certify businesses for their compliance with the ICV requirements. They review the information provided by the company and may conduct on-site audits to verify the accuracy and validity of the data.
- Obtain ICV Certificate: After the evaluation process, the certifying body issues the ICV Certificate if the company meets the program’s requirements. The ICV Certificate signifies the company’s achievement of In-Country Value and its commitment to supporting the local economy. It opens doors to various benefits, such as preferential treatment in government tenders and contracts.
ICV certification in the UAE plays a vital role in supporting the growth of the national economy and promoting sustainable business practices. By encouraging local expenditure, investment, and employment, the ICV program aims to boost the UAE’s industrial sector and diversify the economy. Obtaining an ICV certificate provides companies with various benefits. If you want to learn about the benefits of ICV Certification please go through our Why ICV Certification is Significant in UAE? blog.