WHAT IS ADNOC IN-COUNTRY VALUE (ICV) CERTIFICATION?
From January 2018, the Abu Dhabi National Oil Company (ADNOC) has launched an In country Value program (ICV) with a view to diversify the UAE’s economy by localizing more goods and services, create more employment opportunities for the UAE nationals in the private sector and the localization of important functionalities in the field of oil and gas.
After the implementation of ICV program, ADNOC’s suppliers and service providers are required to show a significant increase in the ICV score by declaring their ICV achievements certificate with respect to the previous financial year. ICV score is now become an integral part of ADNOC tendering process as awarding criteria is now based on the lowest price and high ICV score.
All the ADNOC suppliers are now required to contact an ADCOC certification body for ICV certificate and submit the supplier’s submission template. In the UAE, the ICV certificate can only be obtained from an ICV approved auditor/ audit firm. The ICV auditor/ audit firm will only issue the ICV certificate on the basis of the audit report of an entity issued by an approved external auditor or audit firm from the government of UAE.
ADNOC program is the continuation of 2030 growth strategy which is defined as “creating more profitable and valuable business along with persistent supply of oil and gas”.
Focused Areas of ICV Program:
The ADNOC are considering different strategies as the ICV strategy continues to develop.
- Arranging training programs for UAE nationals to increase the skills and expertise of local work force.
- Promoting CAPEX and OPEX development plans to attract the foreign investment in the UAE.
- Developing long term relationship with suppliers.
Calculation of ICV Score:
The ICV of an on entity is calculated by taking into consideration the economic value of the goods or services offered by the company. Following are consider as the main factors
- Third-Party Spend
- Goods Manufactured
- Job opportunities for UAE nationals
Key Aspects of In-Country Value (ICV) Certificate:
- ADNOC recommend their suppliers to get their ICV certifications from approved ADNOC. Although noncertificate suppliers can also applied for group tenders their ICV score will consider as zero.
- ICV certificate can only be prepared on the basis of the audit report of the last financial year. But the report should not be older than 2 years.
- The validity period of the ICV certificate is up to 18 months from the date of the issue or from the date of new financial statements.
- Suppliers are required to get their revised ICV certificate within two months after the issuance of new audited financial statements.
- ICV certificate has become almost necessary for each business entity, which intends to participate in tender with ADVOC or with any related party.