The National In-Country Value (ICV) Program – Background and key considerations

Background:

The National In-Country Value (ICV) program was first launched and implemented by ADNOC to evaluate its supplier's contribution in the UAE Economy. Due to its effectiveness in opening new opportunities to suppliers who are positively impacting the local economy, various governmental and semi- governmental entities have started adopting this program since 2019 gradually. In 2021, the Ministry of Industry and Advanced Technology (MOIAT) extended the national ICV program to include various sectors at the federal level. The national ICV is a certificate issued to suppliers, evaluating their contribution to the local economy. Certified suppliers are given an advantage during the award of contracts and purchases based on their ICV score.

Objectives:

• Strategic localization of supply chains and the development of new local industries and services;
• Stimulating and attracting foreign investments, diversifying the economy, and increasing exports;
• Creating valuable job opportunities in the private sector;
• Contributing to the growth of national GDP;
• Enhance spending on R&D and advanced technology; and
• Increase the private sector’s contribution to national GDP.

Why Should a Company Obtain an ICV Certificate?

Although obtaining the National ICV Certificate isn't mandatory, it reflects the well-established position of a company in its contribution to the UAE's economy. Companies applying to government and semi government procurements will have a benefit over their competitors. During the tender evaluation process, bidders will be requested to declare their National ICV certificate score. Those without a National ICV certificate will be granted a default 0/- as their ICV score. Therefore, lowering their chances in winning the tender.

Nonetheless, companies who are not interested in bidding with government or semi- government entities may also benefit from getting a National ICV certificate. Due to its unique position in enhancing the UAE economic, the National ICV Certificate has been designed on a ripple effect basis in order to strengthen the local supply chains. Companies obtaining this certificate will witness an increase in demand as they will be approached by the big firms to become their vendors. This is directly linked to the National ICV Certificate they will obtain as it will add value to the customer's ICV score.

Areas of Evaluation:

• Goods Manufactured / Third Party Spend
• Investment
• Emiratization
• Expatriate Contribution
• Exports

Who Issues ICV Certificate?

MOIAT has authorized certain professional firms for the verification and issuance of the ICV Certificate. We, being one of the Certifying Bodies, look forward to assist you with the certification process.

Key Considerations:

• The Company should have Audited Financial Statements, prepared in accordance with IFRS and not older than two years from the certifying year, and signed by a licensed auditor from the UAE Ministry of Economy.
• ICV certificate shall be obtained for each license (legal entity) of a company. However, if a company has different branches in the same Emirate with identical activities and ownership, then a combined ICV certificate will be issued for the Company in that Emirate.
• For companies with manufacturing and commercial licenses, all the accounting records must be split between manufacturing and commercial activities; ICV certificate will be issued for each license separately.
• For companies that are less than 10 months old and do not have audited financial statements, management accounts for a period of up to 9 months can be used for the ICV certification purposes.
• The ICV Certificate is valid for a period of 14 months from the date of issuance of the audited financial statements.

Conclusion:

The ICV certification has evolved since its implementation and is determined to keep growing. Currently, the ICV in UAE is in its third version. The program also protects various initiatives other than oil and gas. The ICV certification authorizes companies with value ratings that show how much the nation is benefitting from that corporation. Strategic considerations, GDP diversification, and Emiratization were encouraged by its implementation.

How can MBG assist you?

MBG Corporate Services is a leading ICV Certifying Body and one of the empaneled firms for the ICV Program and we have a specialized team overseeing this service line, having experience and strong credentials in the region. We have a dedicated team of over 30 professionals based in Abu Dhabi & Dubai having issued more than 2,000+ ICV certificates. Our dedicated team of experts are experienced in issuing in-country value certificates across various industries and can conduct the assignment both remotely and onsite.