In November 2017, Abu Dhabi National Oil Company (“ADNOC”) introduced an In-Country Value (ICV) program to improve the GDP of the country by enhancing local supplies of goods and services, encouraging manufacturing facilities to set up in the country. Emiratisation in the private sector in line with UAE vision 2030 is also one of the main objectives to introduce the ICV program.
In years 2019 and 2020, various Government and Semi-Government Entities (Participating Entities) joined hands to broaden the ICV Certification process and launched the Unified ICV program which requires that all their vendors be mandated to calculate and declare their certified ICV score for the financial year, to demonstrate how they are helping to deliver ICV.
“The main objective of the ICV Certificate is to improve participation of the private sector, facilitate the diversification of Gross Domestic Product (GDP) and localise critical parts of the supply chain. In simple words, the supplier's spend that remains within the UAE or contributes to the UAE is calculated and considered as In-Country Value,” says Peeyush Joardar, Partner – ICV & Audit at MBG Corporate Services, one of the approved certifying bodies in the UAE.
The ICV certificate also helps companies and grants them the opportunity for the first right of refusal in the tender process. While companies who do not possess the ICV certificate will still be allowed to participate in Adnoc Group tenders, their ICV score will be considered as zero in the bid evaluation and they will be at a disadvantage compared to those with a higher ICV score.
“We can help you obtain your unified ICV certificate within a short turnaround time and have a team of experts with a track record of issuing ICV certificates across multiple industries,” he says. “Our job is to first make clients understand the ICV programme and determine factors that affect the ICV score. We then suggest steps for improving the score, including making recommendations about restructuring in organisational processes, legal entity consolidation, investment planning, supply chain optimisation and manpower rationalisation.”
“But if a company has different branches in the same emirate with identical activities and ownership listed on the licences, then one combined ICV certificate is allowed for the company in that emirate,” he explains.Once attained, the ICV certificate is valid for a period of 14 months from the date of issue of audited financial statements. The supplier can get re-certification done during the validity of the ICV certificate if he chooses to, using the same audited financial statements, but the validity of 14 months from the first issue will remain the same.
MBG Corporate Services has set up dedicated in-house teams in Abu Dhabi, Dubai and Sharjah to help and arrange ICV certification. Established in 2002, MBG Corporate Services provides solutions and strategies that drive business transformation. With its headquarters in Singapore, and more than 150 staff working in its UAE office, the company works with clients across Asia, Europe and the Middle East. It has 16 global offices spread across six countries.