A Recap on the In Country Value Program of the UAE
The ICV program is a UAE initiative that aims to develop the local economy through industrial supply chain development. Through this initiative, the UAE seeks to increase supplier involvement from local organizations to support their growth and contribute positively to the economy.
The ADNOC Group has established the In-Country Value (ICV) Program to increase the amount of goods and services sourced in the UAE, thereby creating more meaningful opportunities for citizens and businesses. The program aims to create lasting value for Abu Dhabi and the wider UAE economy, through a growing focus on local content and supplier development.
ICV is an economic diversification program established by the Abu Dhabi government to locally source more goods and services for qualified projects within its jurisdiction. Examples of ICV qualified projects include but are not limited to:
- Exploration and production activities including drilling, workovers, completion of new wells
- Construction/engineering works
- Maintenance activities such as offshore platform maintenance
- Procurement or supply chain management services
- Seismic data acquisition, processing & interpretation services (geophysical surveys)
- Downstream petrochemical activities such as manufacturing petrochemicals or refining crude oil into refined oil products (gasoline, diesel fuel)
To become ICV certified, a company must undergo an independent assessment of its registration and management systems. The award of certification is based on the company’s ability to meet the requirements of the ICV Assessment Criteria.
Companies pursuing ICV certification are required to complete three sections:
- Company registration criteria
- Company management systems and procedures criteria
- Industry sector-specific criteria
To participate in this program and demonstrate your commitment to supporting the UAE economy, you need to be certified. Even if you’re not yet ready for certification, Push Digits Chartered Accountants can help you get set up with our ICV readiness services. We’ll provide consultation on how to achieve compliance with all of the required standards and give your company the best chances at earning its ICV certification with a high ICV score.
Important Resources: All the essential guidelines and documents related to ICV program are as follows:
Why ICV Certificate is Important?
The ICV certificate is required to participate in any tender that comes under the In Country Value program by ADNOC (Abu Dhabi National Oil Company). The certificate will be issued to the company which has made substantial effort to include local partners in production activities. ADNOC is trying to increase the contribution of local companies by at least 25% of the total expenditure by year 2025.
As per our own assessment after conducting a high number of ICV consultations, all the businesses who are delaying to be ICV certified will lose a massive amount of business which will have significant impact on their going concern.
The ICV Certificate Assures that an Operator has made a Substantial Efforts to Include Local partners in Production Activities.
The In Country Value (ICV) program is a government-driven initiative to expand local content in the economy. Companies are required to consider local content in their projects. There are benefits for both companies and countries in developing local partners and suppliers, including cost savings, economic sustainability and improved efficiency. Local content requirements are increasing as governments aim to improve the economies of resource-rich nations through increased participation of local companies.
In order to access work opportunities such as tenders, operators will be required to have an ICV certificate. An operator can attain an ICV certificate by working with the Ministry of Oil & Gas (MOG) and providing detailed information about its supply chain activities, including subcontractors that are owned by nationals from the country where it operates.
What is Point System in the ICV Program?
Companies that participate in tenders for supply contracts with ADNOC and other government entities have to obtain an ICV certificate. The certificate is issued by the Abu Dhabi government, based on a point system.
The points are awarded to companies for each of the four “pillars” of an ICV certificate:
- Local content – this pillar has the highest points threshold, at 100%
- Economic contribution – under this pillar of local value, there are three sub-categories – jobs (25%), community development (25%) and R&D (15%). These categories do not need to total 100%, but rather they add up to 65% of the overall Economic Contribution category.
- Enrichment value under this pillar consists of two sub-categories: UAE national employees (30%) and Emiratization/women’s empowerment/disability employment plans (20%). These two sub-categories make up 50% of the Enrichment Value pillar.
Required Documents for ICV Certification
Acquiring an ICV certificate requires proper documentation such as:
- VAT certificate
- Audited financial statements
- A detailed list of goods and services procured by the business
- ICV% of the vendors used by the business along with their ICV certificates
- Wage protection system reports along with staff list
- Completed ICV Template
- Many other documents i.e. Emirates ID, passport, company licence, etc.