Currently, the government in the UAE is in constant search of decisive measures to guarantee the growth of the country. In other words, the mission is to make this nation one of the most lucrative in the world. Thus, they can attract businessmen and national and international investors. One of the initiatives to boost the economy is the ICV certificate UAE. Country Value (ICV) is a government program in the UAE and the Abu Dhabi National Oil Company (ADNOC) is in charge of the design. In short, this certificate serves to evaluate and measure the value that local companies bring to the country.

In this article, we will explain all the details about why companies need the ICV certificate UAE. All entrepreneurs looking for business opportunities in the country must have this document. That is why it is important to know what it is and how to obtain the ICV certificate UAE. And not only that but also the benefits that you will have access to for having this certification.

What is an ICV Certification in UAE?

Before explaining what is ICV certificate in UAE, you have to know what ICV means. In this case, ICV stands for In-Country Value. Therefore, this certification means In-Country Value certification. The Abu Dhabi National Oil Company (ADNOC) is in charge of initiating the program. The ICV certificate’s purpose is to encourage and incentivize local companies to participate in the world of oil and gas.

If it is still not clear what is ICV certificate UAE, do not worry and continue reading this article. The design of the ICV certification is to assess and measure the economic value that local businesses are bringing to the UAE. In this way, the certification program evaluates the performance of a company taking into account certain criteria for said evaluation.

Among the criteria to evaluate performance, you find local spending, local employment, and what has been the local investment. Thanks to this, it seeks to increase the number of local companies involved in the oil and gas industry. They are even offered support for their growth, giving them preferential treatment in bidding for contracts.

So if you want to be an entrepreneur in the UAE this is a program that boosts both the local economy and the entire country. In this way, those companies that wish to obtain their ICV certification must undergo an evaluation process. Thus, to measure compliance with program criteria. This will be valid for two years and can be renewed after successfully undergoing a re-evaluation.

ICV certification process

Having already clear what is ICV certificate, now you must know how to get ICV certificate in UAE. Because doing business in the UAE is easy, you find the processes to obtain these types of certificates very simple. For this reason, we will explain the entire process to you step by step so that you can obtain your ICV certificate in Dubai, UAE.

• First step (issuing audited financial statements): You must prepare audited financial statements following the International Financial Reporting Standards (IFRS). In addition, it must not be more than two years old from the year the certification was made. On the other hand, if you are a company with multiple UAE business licenses or entities, you must apply for an ICV certification for each one.
• Second step (complete the ICV certificate form): You must accurately complete the ICV template that is available on the MOIAT website.
• Third step (go through the evaluation process): If you want to obtain your ICV certificate, you must go to one of the certifying bodies that are authorized by the MOIAT. In this way, they will be in charge of reviewing your financial status and your ICV template before issuing the certificate. All this provided that all the established requirements were met.
• Fourth step (obtain your ICV certificate): After the evaluation has been done, the certifying body will be in charge of issuing an ICV certificate. You will now be able to present this to government agencies, employers, and any relevant party as proof of the contribution you make to the UAE economy.

Eligibility Criteria for ICV Certification

To take advantage of the investment opportunities that Dubai provides you must know the eligibility criteria of the ICV certificate UAE. The first thing is to know the process of Company registration. Once you finish the procedure, you have the opportunity to request the ICV certificate UAE. This gives them a competitive advantage in bidding for government contracts.

It is important to note that the ICV certificate UAE is not mandatory. However, it is highly recommended to have him. This is especially true for suppliers and manufacturing companies that can use their ICV score to participate in public tenders. All companies that have very high scores have greater opportunities to obtain different government agreements. But, companies that do not have a certificate can put them at a disadvantage compared to other competitors.

The eligibility criteria to obtain the ICV certificate vary depending on the entity and the application program. For instance, there is the national ICV program of MOIAT, any company can obtain an ICV certificate. It does not matter, if it is inside or outside the UAE and the guidelines of the program must be followed.

On the other hand, there is the ADNOC ICV program, only supplier companies can obtain the ICV certificate. These industries must want to participate in ADNOC tenders from an ADNOC-approved certification body and submit the supplier’s submission template. The best recommendation is to consult directly with the entity that requires the ICV certificate UAE. Thus, you can know exactly the eligibility criteria.

Calculating and Reporting ICV Score

Companies in the UAE are assigned an ICV score. The purpose is to reflect the percentage of local content in goods and services. This percentage can be determined by criteria such as product value, R&D spending, national workforce, and contribution to regional economic development.

The ICV score is calculated taking into account several criteria that are interesting to boost economic growth. In addition, they take into account how much the contribution to the development of the UAE would be. Some of the most important factors for this are as follows.

Third-Party Expenses and Manufactured Goods: This is the cost of goods and services incurred by the company compared to the final price. This is one of the most important factors influencing the ICV score.

Investments: That is, the net worth of all assets in the UAE. For example, equipment and property.

Emiratization: These are the costs of the recruitment, training, and employment of citizens of the UAE.

Contribution of foreigners: That is, the number of foreigners who contribute to the company.

Bonus: This refers to other additional factors such as investment growth, Emirati workforce, and revenue outside of the UAE.

In order to calculate the ICV score in the UAE, you must follow the steps below

• First step: Prepare financial statements, by International Financial Reporting Standards (IFRS). It must not be more than two years old from the year of certification.
• Second step: Fill in the ICV certificate UAE template with all the information requested.
• Third step: Pass an evaluation by a certifying entity that has the respective approval. It can be, by the MOIAT or ADNOC, everything will depend on the ICV program of your interest.
• Fourth step: Obtain the ICV certificate UAE with your score.

Enhancing Business Opportunities and Partnerships

Having an ICV certificate gives you significant leverage since you have up to a 40% advantage in the bidding process. Although this certificate is not mandatory and companies that do not have it can participate, its ICV score will be 0. In addition, this certification allows companies to be recognized as approved vendors and suppliers within the MOIAT database.

In this way, it provides them with priority access to different contracting requirements within the participating entities. Also, they are included for projects that are not published as bids. Through the ICV program, suppliers make a strong contribution to the UAE’s goal of boosting local businesses. In addition, they managed to reduce dependence on imports.

This program creates more opportunities for local suppliers to establish partnerships with foreign companies; who want to take advantage of all the competitive advantages of having a joint supply chain. In addition, the holders of the ICV certificate may have a contractual advantage with companies that are associated and the same federal authorities.

Thanks to the ICV score, companies that have higher scores have a better chance of getting government agreements. On the other hand, companies that do not have this certificate are at a disadvantage compared to companies that do. In this way, it is evident that thanks to the ICV certificate, more business opportunities and associations with other companies can be presented.

Benefits of ICV certification

The ICV program provides numerous benefits to the country’s economy. In order to understand why the government entities of this nation seek the ICV certificate, it is good to read the following benefits.

Development and localization: To boost the national economy, the ICV program encourages companies to improve strategies in terms of goods and services of local origin. If you want to maximize your LCI score, companies should do everything they can to prioritize local suppliers. This is for both goods and services.

Foreign investment: As there is greater commercial movement, greater foreign investment is seen. Thanks to this, you help to greatly develop the economy of the nation.

Greater participation of the private sector: The ICV program promotes the participation of the private sector in the economy of the UAE. In order to be able to foster a more stable economic outlook that does not depend so much on oil revenues. In addition, it contributes to the improvement of the income of residents and the creation of employment.

National GDP growth: The ICV program motivates companies to increase local content. This helps to increase the national GDP of the country. In addition, companies actively contribute to the economic growth of the UAE by purchasing and producing more domestic goods and services.

Employment opportunities: This program generates employment opportunities for foreigners and citizens of the UAE. The reason is that one of the factors to evaluate is the hiring of local talent. That is, so you can maximize your score.

Demonstrating Commitment to the Local Economy

Companies in the UAE that hold the ICV certificate demonstrate a commitment to the local economy. The reason is that the certificate evaluates the contribution of the certified suppliers to the economic and social development of the country. The ICV program takes into account local investments, local goods and services, local spending, and the recruitment and training of Emiratis.

The objective is to support national companies. In addition, it redirects the money spent on the purchase of services and products for the domestic economy. Currently, the ICV program has managed to redirect at least 80,000 million dollars to the local economy and create more than 2,000 jobs for the citizens of the country in the private sector. Suppliers that have certificates obtain benefits when participating in contracts due to their ICV score and in tenders.

Engaging with ICV Certification Authorities

The ICV certificate in the UAE requires a relationship with the certification authorities. The reason is that it is the entities with this function that have to evaluate and issue the ICV certificate to the suppliers. All certification authorities are bodies that have the approval of ADNOC or MOIAT, depending on the program.

Suppliers must submit the ICV certificate form. Also, give your audited financial statements to the appropriate authority to obtain your ICV score. On the other hand, certification authorities provide advisory and guidance services to providers on various topics. For instance, such as improving your contribution to the local economy and ICV score and accessing tenders or contracts.

Promoting Economic Diversification and Growth

Currently, there is a long-term plan in the UAE which is the economic diversification strategy. The purpose of this is to reduce dependence on the oil sector and develop other productive sectors that generate added value and employment. This strategy has four fundamental pillars. The first is industrial development, the second is foreign trade, the third is innovation, and finally, human capital.

Regarding the ICV certificate UAE, it is a great contribution to this long-term strategy. The reason is because its function is to promote economic growth and diversification. This is because it encourages local suppliers to participate in strategic sectors. For instance, that of industry, technology, and energy.

In addition, the ICV certificate encourages the development of the skills and abilities of Emirati citizens. Especially, in women, young people, and small and medium-sized companies. Thus, they can integrate into international trade and the labor market. It is also responsible for stimulating the competitiveness and innovation of local suppliers. In summary, it provides greater profitability and productivity.

Empowering Businesses through ICV Certification

The ICV Certificate UAE empowers companies because they have the opportunity to demonstrate their social and economic value. This is through its business activities and operations. It is common knowledge that the ICV Certificate evaluates the performance of companies, taking into account some criteria. Among them, are local investment, local employment, and local spending.

All companies that have the certificate obtain benefits by participating in tenders and contracts with private and public entities; especially in the energy sector. It is also important to highlight that the ICV certificate helps to improve your productivity, competitiveness, and quality.