How to apply for an ICV certificate in Dubai, UAE

Did you know that having a National In-Country Value Certificate (ICV) can help you increase your chances of securing a government contract?

The national ICV certificate is issued to companies working in the UAE that directly boost the country’s economy. It reflects how much you are procuring from within the country, be it local products and services, investments, and the hiring and development of Emiratis. This certificate gives you an edge when acquiring a government tender or contract.

What is an ICV Certificate?

Wondering what is an ICV certificate? National In-Country Value Certificate is a program that was launched by the Ministry of Industry and Advanced Technology (MoIAT). It encourages local businesses to work within the country and boosts the local economy.

The document evaluates the number of national employees (Expats +Emirati) hired, the amount of materials acquired from other local businesses, and the amount the company invests in the country’s infrastructure and helps improve technological development.

In short, ICV certification measures a company’s contribution to the local economy.

Goals of the ICV Certification

The establishment of the national ICV certificate dubai aimed to achieve the following goals:

GDP Growth

One of the key objectives of the national in-country value program is to promote the country’s GDP growth. The program encourages the companies to source raw materials and labor domestically, supporting small and medium-sized companies.

Human Capital Development

The National In-Country Value Program aims to create more job opportunities in the country. It motivates companies to hire and train the local workforce with the necessary skills and give them a chance to work in the private sector.

Sectors Required to Obtain ICV Certification

Suppliers and Contractors of Government-Owned Companies

According to the country’s laws, all companies and their subsidiaries that provide supplies to government-owned companies like the Abu Dhabi National Oil Company (ADNOC) must obtain the national ICV certificate UAEThis requirement applies to all government-owned companies operating in different sectors, such as drilling, engineering, and logistics.

Other Sectors Bidding on UAE Government Contracts

Apart from the suppliers and contractors of ADNOC , any company that wants to bid for UAE government contracts and tenders, whether in the transportation, construction, manufacturing, retail, or healthcare sector, is also required to have a national ICV certificate UAE to qualify for the bidding.

Role of Certifying Bodies

Contact certifying firms that help you calculate your company’s national in-country value to get your in-country value certification. The Ministry of Information and Technology (MoIAT) oversees the national ICV certification process.

They not only ensure that the program is being implemented successfully across all sectors but also set the guidelines, monitor compliance with the set policies, and work with certifying firms to ensure transparency and efficiency of the process.

There are 25 certifying firms working currently that can help you get a national ICV certificate. Adepts offers professional assistance and works with certified auditors that can help you get an authentic and accurately calculated national ICV score.

Benefits of ICV Certification in UAE

MoIAT recorded a considerable increase in the number of Emiratis working in private sector companies certified by the program. The number of Emiratis employed in companies holding the “National In-Country Value” certificate by the end of the first half of 2024 reached approximately 19,000, a 40% increase over the first half of 2023.

Since its implementation, the program has resulted in a qualitative increase in the expenditure of major national companies on local procurement and services, reaching AED 48 billion by the end of the first half of 2024.

In addition, investments of ICV-certified companies totalled AED205 billion, marking an increase of 20% compared to the same period in 2023.

The program’s growth builds on its earlier successes, where it reached AED 53 billion in end-2022, an increase of 25% over 2021. By end- 2023, this number reached AED 67 billion, with a growth rate of 26% in local spending on products and services among the entities implementing and joining the program. The value of investments by registered suppliers within the country exceeded AED 200 billion in 2023.

Holding ICV certification has many advantages for the UAE economy for different industries, as it religiously supports local content production and consistently encourages businesses to invest in the UAE’s regional economy.

Here are a few benefits that highlight the positive impact of National In-Country Value Certificate.

Economic Uplift Since the Inception of the ICV Program

The effectiveness of the National In-Country Value ICV UAE program over the last several years has facilitated an increase in private-sector investment and participation in several areas, leading to increased economic durability. Aligning with national strategies like “Operation 300bn” and the UAE’s industrial strategy, ICV Program aims to improve the UAE’s economic and socio economic development, injecting AED178 billion ($49 billion) back into the UAE’s economy by the year 2028.

Boost to Private Sector Participation

Having a national ICV certificate UAE has made private sector companies eligible to bid on government projects and secure contracts. Such engagement creates competition in the private sector, hence promoting economic growth and development.

Increased GDP Diversification

The certification of ICV UAE also contributes to the growth of the non-oil and gas product-producing region, therefore improving the UAE’s GPD. ADNOC targets local manufacturing of AED90 billion ($24.5 billion) worth of critical industrial products in its procurement pipeline by 2030. Diversification is of primary importance, as it would help to organize a better balance of the economy and make it less dependent on oil rates.

Localization of Supply Chains

The national ICV certificate UAE promotes local businesses. These localization efforts create strong domestic supply chains to reduce import reliance and strengthen the efficiency of the local industries.

Advantages for Small and Medium-Sized Businesses (SMEs)

Another benefit of the national in-country value certificate is that it has significantly helped grow small and medium-sized enterprises (SMEs). When companies start to purchase more products locally, it allows these small and medium-sized enterprises to grow by increasing their production, generating more revenue, and developing into bigger ones as more orders and customers come in.

Preference in Government Tenders for Local Manufacturers

Certified businesses have an advantage over competitors when applying for government contracts. In addition to helping domestic companies, the preference for local manufacturers serves the UAE’s strategic objectives of promoting regional economic growth.

What is ICV verification?

As per MoIAT’s directions, certified suppliers will gain advantages when tenders and contracts are awarded based on their ICV score.

Companies must meet general standards or requirements to receive ICV certification; these requirements have been developed in compliance with the program’s objectives. The government has subdivided these criteria into general conditions and the certification procedure.

Basic Eligibility Requirements for Companies

Registration with Appropriate Government Agencies

Depending on the emirates where the company operates, it must register with the appropriate local agency, such as the Department of Economic Development (DED). This registration ensures that the business complies with the country’s laws.

Physical Presence in the UAE

To register for a national ICV certificate in UAE, you must have a physical presence in the UAE. This means that the firm should physically operate in the UAE through a local office or offer its products or services in the country.

Industry-specific National ICV requirements

Every sector has tailor-made specifications and criteria when it comes to national ICV certificates UAE.

For example, oil and gas companies consider the number of national citizens hired, the investment in infrastructure, and the local content of the products and services offered.

The health care department may consider adding factors like locally sourced equipment and compliance with health care rules and safety standards. The construction industry might consider adopting eco-friendly practices and collaborating with SMEs or small businesses.

Therefore, a company seeking a national ICV certification will need to meet the criteria set by the relevant sector.

Disclaimer: The eligibility criteria for obtaining a national ICV certificate depends on multiple factors beyond the basic requirements listed above. Companies should consult professional advisory entities to determine their specific eligibility and ensure compliance with sector-specific regulations.

How to Obtain a National ICV Certificate?

Once the company has met the basic eligibility criteria according to its industry, it must follow a set process for obtaining the national ICV Certification.

Independent Audit by an Authorized Certifying Body

The first step is an independent audit by an independent licensed auditor. In this audit, the firm will evaluate the company to see if it meets the national ICV certification requirements.

Evaluation of Local Content, Investment, and Workforce Emiratization

The authorized certifying body will evaluate the company to determine how much it is actually contributing to the growth of the local economy.

They will check the number of Emiratis hired and trained, the amount invested in the UAE’s infrastructure, such as technology, research, development, etc., and, lastly, evaluate how much of the company’s resources it is sourcing from local businesses.

The certified bodies then calculate a national ICV score. If the company meets the requirements, a national ICV score certificate will be awarded, making it eligible to bid for government tenders and contracts.

Steps to Obtain National ICV Certification in UAE

To get an ICV certification, a structural ICV certification process must be followed, and the business organizations must be fixed to the UAE’s economic vision. Here are the necessary steps on how to apply for an ICV score certificate.

Audited Financial Statements

The first thing a company needs to do when obtaining a national ICV certificate is to prepare its financial statement and get them audited by an independent licensed auditor who is approved by the UAE government and works in accordance with International Financial Reporting Standards (IFRS) and International Standards on Auditing (ISA). The Audited Financial Statements must not be older than 2 years from the certification year.

However, if the company is less than 10 months old, the management accounts, (unaudited financial statements) for a period of up to 9 months can be used for ICV calculations. Any management accounts exceeding 9 months will require auditing.

Complete the National ICV Certification Template

The next step is to complete the national ICV certification template. This template helps you to calculate your national ICV score. In this template, the following data is recorded, and the companies must adhere to the national ICV program’s instructions:

Local procurement values
Investments made in local operations
Employment statistics regarding UAE nationals and expatriates
Any other relevant financial metrics that demonstrate local engagement

Evaluation by a Certifying Body

The third step is to get the documents evaluated by a certified body.

Once the documents are in place and the template has been filled out, the company will submit the documents to an authorized certifying body to verify everything. These certified bodies are separate organizations approved by the program to assess and certify businesses.

The certifying body will review the company’s submitted documents and use the information to calculate the national ICV score. They will also perform an on-site audit to verify the accuracy of the information provided and confirm compliance with national ICV regulations.

Obtain the National ICV Certificate

Once you have been evaluated by a certified body, the last step is to get a national ICV certificate. The national ICV certificate will be issued (7-10 working days) if all the documents are complete and accurate.

The national ICV certificate will demonstrate a company’s commitment to supporting the UAE’s economic growth. It can also provide advantages such as special consideration in government tenders and deals.

Validity and Renewal of National ICV Certification

A national ICV certification in the UAE is typically valid for 14 months from the date of issuance of the Audited Financial Statements.

If your certificate has expired, and you wish to renew the national ICV certification, the following steps will be followed.

Submission of Updated Financial Statements

To renew your certificate, you will have to submit a new audited financial statements. These statements should reflect the company’s current financial state and any changes in its operations.

Reassessment and Re-Certification

Following the submission of updated financials, an authorized certifying body will conduct a reassessment. Based on the latest data, this process involves evaluating the company’s local content, investment in UAE operations, and Emiratization efforts. If the company meets the required criteria during this evaluation, it will be re-certified with a new ICV certificate.

Key Considerations for Obtaining National ICV Certification

Did you know the higher your score on your national ICV certificate, the more credible you will be and the higher your chances of securing a government project?

To get a higher score, you must abide by the set rules and regulations and follow the criteria below. You want to obtain the best possible in-country value for your company.

IFRS Compliance for Financial Statements

If you’re applying for national ICV certification, your financial statements must follow the International Financial Reporting Standards (IFRS), the accounting rules used in UAE. This ensures that your company’s financial data is presented in a standard, transparent way that meets legal requirements.

Eligibility of Businesses with Multiple Branches

A business with multiple branches can apply for a single combined national ICV certification only if it meets all conditions being : the branches must be in the same Emirate, with identical business activities and ownership listed on the licenses. If any of these conditions are not met, each branch will be considered a separate legal entity and must obtain a separate ICV certificate even if the ownership is the same.

Moreover, obtaining an ICV certificate is not mandatory for every branch.

However any branch who intends to participate in government tenders and related activities should obtain one.

Inclusion of Salaries in National ICV Calculations

The salary paid to company owners can be included in the national In-Country Value (ICV) score if the owner is registered under the Wage Protection System (WPS) and receives their salary through the WPS. Additionally, the owner must be under the company’s visa. If these conditions are met, an Emirati owner can claim up to AED 120,000, while an expatriate owner’s salary must be excluded from the total cost. This distinction impacts the overall ICV scoring during the evaluation process.

Payments to Government Authorities Count for National ICV

One of the most amazing things when calculating your national ICV scores is that any payments made to government organizations, including free zones, can count fully towards your national ICV score. If your company is paying for licenses or other services to government bodies, you can include those payments as part of your national ICV calculation, boosting your overall score.

Introduction to Adepts as an ICV Facilitator in UAE

Adepts offers a full range of ICV services to companies that want to obtain an ICV score certificate. Considering the ICV program’s established characteristics and expectations, Adepts promptly assists companies in following the program and achieving certifications that will help them contribute most efficiently to the local economy, including advisory in:

ICV Certification
ICV Advisory
Score optimization
Systematic implementation of ICV Policies and Procedures

Services Provided by Adepts for National ICV Certification

ICV Certification: Adepts takes care of the complete ICV certification process, ensuring your business fulfills all regulatory requirements and submits accurate financial documentation for national ICV certification evaluation.
ICV Improvement Plan: Adepts offers a tailored national ICV improvement strategy to help your company increase its national ICV score. We focus on specific areas relevant to your business, ensuring you stay compliant and competitive in the UAE market.
ICV Score Enhancement Advisory: Adepts provides its clients with a detailed national ICV score improvement strategy. This ongoing support aims to help you continuously optimize your internal processes and sourcing strategies to improve your score and eligibility for government contracts.

Representation During the Audit: Adepts acts as a representative during the independent audit conducted by ICV certifying bodies. Their proficiency guarantees the efficient execution of the audit process, besides which all essential information is communicated logically.

Conclusion

In conclusion, the national ICV certification has grown since its launch in 2018 by ADNOC and has changed over time, becoming an essential tool for businesses in the UAE.

Now in its third version, the certification not only assesses a company’s economic contribution but also highlights its investment in local resources and development.

The national ICV certificate is crucial for businesses that want to succeed in the UAE. It encourages them to invest in the local economy, create jobs for nationals, and support sustainable practices.

It also helps the country diversify its economy and provide more opportunities for UAE nationals.

FAQs

What is the cost of getting an ICV certificate?

The cost of obtaining an ICV certification varies based on several factors, including the company’s revenue, the nature of the license (commercial or manufacturing), the number of expatriate and Emirati employees, the number of ICV-certified vendors the business engages with, and whether the company directly deals with government-owned or semi-government entities. These elements influence the complexity of the audit and evaluation process, ultimately affecting the certification cost.

Can companies apply for an ICV certificate if they are not bidding for government contracts?

Yes, while the primary purpose of ICV certification is to enhance eligibility for government tenders, companies that want to demonstrate local economic contribution and strengthen their market position can also apply.

Can a company that has multiple branches use a single ICV certificate for all its branches?

A business with multiple branches can use a single combined ICV certificate Dubai only if the branches are in the same Emirate, with identical business activities and ownership listed on the licenses. If not, each branch will be considered a separate legal entity and must obtain a separate ICV certificate even if the ownership is the same.

Can expatriate employees' salaries contribute to the ICV score?

Yes, the salaries of foreign employees are partially counted. When calculating the ICV score, the salaries are considered only if the employees are under the company’s visa, whereas 100% of salaries are counted for UAE nationals.

Does ICV certification affect a company's tax obligations?

No, the ICV certification has nothing to do with a company’s tax obligations.

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