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The National In-Country Value (ICV) Program by the UAE government aims to boost economic performance and support local industries by redirecting higher portions of public spending into the national economy. The program takes into consideration local expenditure on manufacturing, local products and services, investments, and the hiring and development of Emiratis. It aims to support the national industry and redirect expenditure on procuring goods and services into the national economy. Basically, it evaluates the contribution to the local economy.
Companies inside or outside the UAE are eligible to apply for an ICV Certification per the ICV guidelines. ICV certification is required for all companies that wish to apply to governmental and semi-governmental procurements. The ICV factor accounts for a certain weightage in tender evaluation. However, this is not a mandatory requirement.
The Tier 1 suppliers (suppliers directly providing goods or services to the Partners of the Program) may have to declare their ICV Score because it’s an essential part of their tender evaluation and award process. Suppliers belonging to the Tier 2 category and below also need to present their ICV Certificate to ensure competitiveness in their tenders with Tier 1 suppliers.
As part of the ICV program, the Companies are required to submit the ICV certificates and will be evaluated based on the ICV score achieved and are then given an access to participating entities procurements during the contract awarding process. The ICV Certificate is required to be certified by one of the Certifying Bodies on an annual basis.
The suppliers are required to submit the Unified Supplier Submission Template provided by the Participating Entities (PEs) which should be filled based on the supplier’s audited financial statements based on which the ICV certificate will be issued.
The certificate is valid for a period of 14 months from the date when the supplier’s financial statements were issued
The ICV audit is a pre requisite to obtain the ICV Certificate. The audit will assess the economic value added by the company to the local (UAE) economy. Undergoing the ICV audit will enable the companies to prove that they comply with ICV guidelines.
ICV improvement plan carries more weightage during bid evaluation compared to the existing ICV Certificate. Therefore, even if a Company’s ICV Certificate is showing a good score, there are still chances to be at a competitive disadvantage if the improvement plan will not be showing notable improvement in ICV score in subsequent years covering the agreement year. The ICV Improvement Plan is a contractual commitment linked to payment against the achievement of actual ICV achieved with the ICV committed as per the ICV Improvement plan. The improvement plans can be either company based or agreement based. Having a sound improvement plan helps improve your ICV Score thus gaining greater edge in bidding process.
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