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Understanding the ADNOC In-Country Value (ICV) Program

In 2018, Abu Dhabi National Oil Company (ADNOC) launched the In-Country Value (ICV) program to increase its ICV contribution through a procurement-led strategy. The initiative focuses on developing UAE nationals, choosing local suppliers, and localizing essential functions for the oil and gas sector. The purpose of this article is to explain all you need to know about the ADNOC-ICV program, including how to obtain ICV certificate UAE and what benefits you’ll receive from it.

Key Objectives of the ICV Program

The primary goals of the ADNOC ICV initiative are:

  • Raising the amount of products and services purchased from vendors in the UAE
  • Maximize employment opportunities for UAE citizens within ADNOC’s supplier chain.
  • Strengthen the capacity for local production and service provision
  • Educate and guide regional businesses
  • Raises the oil and gas industry’s share of GDP in the United Arab Emirates

ICV Certification Requirements

The ADNOC tender procedure requires all providers to get an ICV Certificate from the MoIAT, which stands for the Ministry of Industry and Advanced Technology. Suppliers who have earned the ICV Certificate have proven their dedication to and capacity to aid in the economic and social development of the United Arab Emirates.

The ICV Certification Program offers three tiers of accreditation: Bronze, Silver, and Gold. A supplier’s certification level is determined by how well they contribute to the UAE’s economy, which is determined by the following criteria: 

ICV Certificate Areas of Consideration

 

Area of ConsiderationWeightage
Goods Manufactured/  Third Party Spend50%
Investment25%
Emiratization15%
Expatriate contribution10%
ICV Bonus – Revenue from Outside UAE, Emirati Headcount, and

Investment Growth

5%
Advanced Technology and Sustainability Bonus3-6%

 

To be certified, suppliers need to reach the minimum score standards for each pillar as well as the total ICV % objectives given by MoIAT.

Benefits of ICV Certification

Suppliers that have obtained an ICV Certificate have many advantages when competing for contracts with ADNOC and its affiliated companies:

  • Opportunity to participate in ADNOC’s tenders
  • Contract success is more likely when ICV assessment criteria are used in bids.
  • More chances to do business as ADNOC seeks to offer contracts to qualified vendors
  • Connections made possible via ICV’s matching forums and networking events
  • Support and direction from ADNOC to enhance their ICV contribution

ICV Evaluation in Tenders

In assessing offers from suppliers, ADNOC takes both financial and technical factors into account. A bidder’s ICV score is an independently assessed business metric. During the commercial review, bidders with higher levels of ICV Certification, such as Gold or Silver, benefit more than those with lower levels, such as Bronze, or no certification at all. 

For the purpose of technical bid evaluation, ADNOC has included ICV sub-criteria to further encourage suppliers to enhance their ICV contribution over time. Considerations for ICV are included in technical criteria such as “Implementation Methodology” or “Health, Safety, and Environment Plans” in order to evaluate the potential effects of the technological solution on ICV.

Boosting ICV Performance

Suppliers doing business in the UAE might get an advantage and access more prospects with a better ICV score. To improve their ICV performance, companies may do the following:

  • Increase National Workforce through Emiratization: Suppliers may improve their Emiratization score by hiring more UAE citizens and instituting training programs specifically for them. Companies may make a greater contribution to the national employment goals of the ICV program by implementing targeted activities to recruit and retain national talent.
  • Outsourcing to Local UAE Suppliers: To enhance the In-Country Sourcing pillar score, it is helpful to identify local skills and outsource more goods and services locally. Companies may access a broader selection of components and services from within the UAE by conducting supplier development workshops to increase local vendor capabilities.
  • Set Up Local Facilities: The establishment of local assembly or repair facilities, manufacturing factories, or both in the UAE results in the creation of local jobs and the transfer of technology. The dedication to the home market and economy is evident via these capital investments and infrastructure development projects.
  • Invest in R&D: Businesses may aid the ICV program’s knowledge economy objectives by forming strategic partnerships with national institutions and universities to conduct research and tests. In addition to enhancing national skill sets, collaborative applied research initiatives are eligible for better R&D scores.
  • Provide Training: Employees from the United Arab Emirates can improve their skills and competence for the workforce by receiving on-the-job training in technical and managerial areas. An organization’s commitment to developing industry talent is demonstrated via structured mentorship and skill development initiatives.
  • Mentor SMEs: A great way to support local businesses is to form partnerships with smaller enterprises in the area. This may be done by subcontracting work or offering supply chain possibilities. Through this oblique link, SMEs are able to reap the rewards of bigger companies’ ICV accreditation and performance.

FAQs

  1. How often does the ICV Certification need renewal?
  2. The duration of an ICV certification is fourteen months. Suppliers that want to keep bidding on ADNOC contracts must submit another application for recertification before the end of the contract period.
  3. Can a supplier’s ICV level be downgraded?
  4. Yes, upon review, MoIAT retains the authority to lower the ICV Certification level if a supplier’s ICV performance substantially falls below the initial certified level.
  5. What are the penalties for non-compliance?
  6. Penalties for suppliers that do not meet their ICV obligations may include terminating the contract, being placed on a blacklist, and being prohibited from bidding for a certain amount of time. Failure to comply on repeatedly may lead to the cancellation or suspension of ICV Certificate UAE.

Conclusion:

In conclusion, suppliers should think about collaborating with expert ICV consulting companies in the UAE if they want to optimize their ICV scores and certification levels. When it comes to ADNOC bids, these specialists can guide you through the regulations, find the gaps, and provide tailored solutions to boost your contributions across all pillars of ICV certification.

Read More: What are the documents required for ICV in UAE?

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