In-country value certificate and your business in UAE
An ICV-certified organisation avails a host of benefits that will help expansion within the country and beyond
In 2018, the Abu Dhabi National Oil Company (ADNOC) introduced the In-Country Value (ICV) programme to drive Emiratisation, GDP diversification and localisation of critical areas of the supply chain. The Abu Dhabi Department of Economic Development, Abu Dhabi Ports, ALDAR Properties, Mubadala and ENEC joined hands with ADNOC in 2020 to launch a unified ICV certification process for suppliers in the UAE. Today, there are over 60 'participating entities' partnering on the programme.
In-Country Value refers to the degree of indigenisation of a business in the UAE. "Put simply, the company's spend that remains inside and contributes to the UAE is calculated as its In-Country Value," says Peeyush Joardar, partner - ICV and audit at MBG Corporate Services, an approved ICV certifying body in the UAE.
A Unified ICV certificate, which consolidates the ICV process into a single certificate, is required by supplier companies to participate in procurement tenders of the participating entities.
As of December 2019, the ADNOC ICV programme had driven over Dh44 billion ($12 billion) back into the UAE's economy and put more than 1,500 Emiratis in the private sector. Over 3,000 companies in the UAE are ICV certified.
ICV certification includes, among others, goods manufactured, investment, Emiratisation, expatriate contribution, revenue from outside the UAE, and growth in investment.
The ICV certificate grants companies the first right of refusal in the tender process. While companies can still participate without an ICV certificate, their bids stand at a significant disadvantage as their ICV score component is zero.
"At MBG, our experts, experienced in issuing ICV certificates across multiple industries, help you obtain your certificate in quick time," Joardar says. "We help clients understand ICV and the factors that affect their ICV score; we then advise steps to improve the score through organisational restructuring, legal entity consolidation, investment planning, supply chain optimisation and manpower rationalisation, etc."
ICV certification is based on the audited financial statements of the company as per International Financial Reporting Standards. Financial statements should not be older than two years from the certification year. For companies with multiple entities, each license within a group is considered an independent legal entity.
"But if a company has different branches in the same emirate with identical activities and ownership listed on the license, then one combined ICV certificate is allowed for the company in that emirate," Joardar explains.
The ICV certificate is valid for 14 months from the date of issue of audited financial statements. The supplier can get re-certificated during this period but the 14-month validity from the first issue remains.
MBG Corporate Services has dedicated ICV teams in Abu Dhabi, Dubai, and Sharjah. Established in 2002, MBG provides solutions to drive business transformation. Headquartered in Singapore and with 200 staff in its UAE offices, the company has 16 global offices in six countries across Asia, Europe, and the Middle East.
Watch the ICV Webinar co-hosted with Aldar here: https://www.youtube.com/watch?v=ioDEXP0e7iI
For more on how MBG Corporate Services can help with your ICV certification, email email@example.com or WhatsApp +971 52 640 6240
Peeyush Joardar is partner and Taher Singaporewala is director - audit and ICV at MBG Corporate Services
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