ICV (In-country value) Certification, a significant initiative launched by the Abu Dhabi National Oil Company (ADNOC) in the UAE, plays a pivotal role in assessing the extent to which local companies contribute to the UAE’s economy, particularly within the oil and gas sector. This program evaluates various essential elements, including local expenditure, the employment of UAE nationals, and investments made within the country. The primary objective of ICV Certification is to encourage greater participation of local businesses in the oil and gas industry and simplify their access to valuable contracts. By promoting GDP growth, enhancing human capital development, and driving technology adoption, this initiative aligns with the UAE’s strategic goals for economic advancement.
Benefits of the ICV Certification Program
ICV certification in the UAE offers a threefold advantage to businesses.
- Firstly, it encourages increased private sector participation, leading to greater GDP diversification and underscoring the importance of localized supply chain components.
- This results in expanded growth opportunities, especially for small and medium-sized enterprises (SMEs), as supply chains become more accessible and localized.
- ICV-certified companies gain access to contracts not only from federal authorities but also from partner corporations, opening doors to lucrative prospects.
- Moreover, ADNOC actively champions local manufacturing by giving priority to bids from these local units or their representatives in the procurement of goods.
- This preference for local manufacturers elevates the ICV scores of suppliers, creating a mutually beneficial scenario.
- Local businesses thrive while simultaneously contributing to the broader economic advancement of the UAE.
To sum it all up, It’s a win-win situation where both businesses and the nation’s economy flourish.
Who Should Apply for the ICV Certification?
- Suppliers and Contractors to ADNOC Should Apply for ICV certification (H3)
Since the certification is issued by ADNOC, all companies providing goods and services to it and its subsidiaries for it. The reason behind that is that this certification ensures that companies involved in supporting ADNOC’s operations maintain high standards of quality and commitment.
- Businesses seeking to work with the UAE government are required to obtain ICV certification (H3)
ICV Certification isn’t limited to the oil and gas sector; it’s also relevant for companies in other industries seeking to do business with the UAE government. Companies in sectors like construction, transportation, and healthcare, which have significant potential in the UAE, may need ICV Certification when bidding for government contracts.
How to Get an ICV certification in the UAE?
First Companies Should Have the Required Criteria
To acquire ICV (In-Country Value) certification in the UAE, companies make sure that they are eligible for this certification. To ensure that, companies should refer to the following points:
1. Ensure They Meet the Initial Criteria:
- Be registered with UAE governmental authorities.
- Possess a valid trade license.
- Maintain a physical presence in the UAE.
- Actively provide services or products within the country.
2. Take Care of Industry-Specific Requirements:
Each industry sector has its distinct ICV program with tailored criteria. For instance, some sectors may have requirements for Local content in their offerings and Emiratization goals, particularly relevant in sectors like oil and gas.
- Undergo Certification Assessment: Companies seeking ICV certification must undergo a rigorous assessment conducted by an authorized ICV certification body. This assessment evaluates their performance about the specific ICV standards of their industry sector.
Second Companies Should Follow Certain Steps
- Submit Audited Financial Statements: Newly formed companies (less than 10 months old) must provide financial reports based on International Financial Reporting Standards (IFRS) or management accounts for ICV certification.
- Complete ICV Template: Fill out the ICV template, a standard form, with data about various aspects of your business operations, such as local sourcing, community investment, Emirati employment, and more, to support the local economy.
- Get Assessed by a Certifying Body: Approach an authorized certifying body recognized by the ICV program. They will evaluate your ICV template and conduct an on-site audit to verify the provided information.
- Receive ICV Certificate: Once the certifying body confirms your compliance with the program’s requirements based on the template and supporting documents, they will issue the ICV certificate.
ICV Certification Validity:
Typically, an ICV certification in the UAE is valid for 14 months from the date of submitting audited financial documents or when new financial statements are issued, whichever is earlier. To renew, submit updated financial statements, and complete a fresh ICV template. Ensure ongoing compliance with ICV criteria throughout the year for renewal.
Final-take Away
The ICV (In-Country Value) Certification program, led by ADNOC (Abu Dhabi National Oil Company) in the UAE, evaluates the contributions of local businesses to the nation’s economy, particularly in the oil and gas sector. It scrutinizes elements such as local spending, the employment of Emiratis, and domestic investments, all in line with the UAE’s economic objectives.
ICV certification carries several advantages, including boosting private sector involvement, expanding opportunities for SMEs, and granting access to lucrative contracts. To obtain ICV certification, companies must meet specific criteria, align with industry requirements, and undergo a rigorous certification assessment, which includes submitting financial statements and an ICV template. This certification process is vital not only for businesses aspiring to collaborate with ADNOC but also for those seeking government contracts in various sectors beyond oil and gas.
Read More: Unlocking Business Opportunities: The Role of ICV Certification in the UAE
