The ICV score in UAE is a measure of the In-Country Value (ICV) generated by a supplier in the UAE. It is calculated based on several factors, including the cost of goods manufactured or third-party spend costs, investment in the UAE, Emiratization, expatriate contribution, and revenue from outside the UAE. The ICV score is used to assess a supplier’s contribution to the UAE economic growth and their commitment to supporting local businesses and creating job opportunities for Emiratis. A higher ICV score in UAE indicates a stronger commitment to local sourcing and investment, which can be beneficial for suppliers seeking to win contracts with government entities or other organizations that prioritize local sourcing and investment. Consult ICV Certificate expert for detail information.
Steps to Improve Your ICV Score in UAE
To improve your ICV score, you can take the following steps:
1. Increase investment in the UAE: To increase your ICV score, start by investing in the UAE. Allocate resources wisely to support the country’s growth. This means putting money into things like technology, infrastructure, and community projects. By investing locally, you not only boost your ICV score but also align your business with the UAE’s goal of long-term, sustainable development.
2. Hire more Emiratis: To improve your ICV score, focus on Emiratization. This means hiring more people from the UAE. Actively take part in this effort by creating jobs, offering training, and helping Emiratis grow in their careers. Having a diverse workforce that includes locals not only boosts your ICV score but also helps the country socially and economically.
3. Reduce reliance on expatriate workers: While it may not be possible to completely eliminate the use of expatriate workers, reducing their numbers can help improve your ICV score. You can do this by hiring more Emiratis or outsourcing certain functions to local vendors.
4. Source goods and services from local vendors with high ICV scores: When purchasing goods and services, look for local vendors who have a high ICV score. This will help increase your own score and support the local economy.
5. Partner with other companies to increase your ICV score: Collaborating with other companies can help you achieve economies of scale and reduce costs, which can in turn improve your ICV score. For example, you could team up with a local logistics provider to transport your goods, or partner with a local manufacturer to source raw materials.
6. Participate in Community Development Programs: Participate in community development programs to demonstrate your commitment to the local community and increase your ICV score.
Improve Your Financial Performance: Focus on growing your income by exploring new revenue streams and securing local contracts. Simultaneously, implement effective cost-saving strategies to streamline operations and make your spending more efficient. These steps not only contribute to a more robust financial position but also positively impact your ICV score.
Remember that improving your ICV score in UAE is an ongoing process, and requires a long-term commitment to supporting the local economy and creating job opportunities for Emiratis. By taking these steps, you can demonstrate your commitment to the program and increase your chances of winning contracts with government entities and other organizations that prioritize local content.
How to Calculate ICV Scores?
ICV Score = (Goods Manufacture Cost + Investment in UAE + Emiratization + 0.6 x Expat Contribution + Bonus) / Total Cost x 100
For Service Providers:
ICV Score = (Third Party Spend Cost + Investment in UAE + Emiratization + 0.6 x Expat Contribution + Bonus) / Total Cost x 100
ICV = (Net Book Value of Assets in UAE / Net Book Value of Total Assets) x 0.1 (weightage 10%)
Plus 15% on a progressive basis for Asset NBV from AED 5 Million to AED 150 Million.
ICV = 2% for Annual Salary, benefits & training up to AED 200K.
Progressive increase up to 15% for Annual Salary up to AED 20 Million.
For Expat Contribution:
1 to 5 Expats: 1 to 3%
6 to 50 Expats: 4 to 6%
51 to 200 Expats: 7 to 9%
Above 200 Expats: 10%
lRevenue from outside UAE:
ICV = (Total Annual Revenue from outside UAE customers excluding Re-exports / Total Annual revenue from inside + outside UAE) x 5%
Note: Revenue without value addition and trading/commission earnings not considered.
ICV = (Number of Emiratis enrolled in WPS / 100) x 5%
Bonus capped at a maximum of 5%.
ICV = ((Net Book value of UAE Assets in current FS – Net Book value of UAE Assets in previous year’s FS) / Net Book value of UAE Assets in previous year’s FS) x 5%
Total bonus components (a, b, c) combined not to exceed 5%.
ICV Auditors and Boosting Scores
ICV Auditors play a crucial role in helping businesses achieve high ICV scores. These auditors are responsible for evaluating and verifying the various components that contribute to the ICV score, such as local sourcing and investment, employment of UAE nationals, investment in technology, and contribution to the local economy. By conducting thorough assessments and audits, ICV Auditors ensure that companies are meeting the required standards and regulations set by the government. They provide valuable insights and recommendations to improve ICV performance, ultimately helping businesses enhance their scores and demonstrate their commitment to the UAE’s economic growth and diversification.