Confirmation of an extension to the deadline for classification of contractors and engineering consultancy offices in Abu Dhabi offices until late 2014.
It has been recently confirmed that the deadline for classification for Contractors and Engineering Consultancy offices in Abu Dhabi has been extended to 21 November 2014.
The Contractors and Consultants Classification and Engineers Registration office at the Department of Municipal Affairs in Abu Dhabi (DMA) confirmed that the deadline had been extended at a recent workshop held by representatives from the DMA. This does not mean that contractors and engineering consultants can necessarily delay obtaining classification until then. The consequences of not being classified means that a company may not be able to hold a commercial license issued by the Abu Dhabi Department of Economic Development. Without a commercial license, a company cannot do business in Abu Dhabi.
Practically speaking, it is in a company's commercial interest to become classified in order to secure projects. As mentioned in our previous article, there is an increasing trend in tender documents to require contractors and consultants to supply evidence of their classification grade. Frequently a contractor or consultant will not be permitted to tender for government projects in Abu Dhabi without completing the obligatory classification regime, regardless of the extended deadline. Likewise, where a new entrant to the market wants to engage in the Contracting or Engineering Consultancy sectors it will be required to be classified regardless of the extended deadline. Limited grace periods are usually afforded to new entrants to allow completion of the classification process.
Companies which are required to be classified should carefully consider the timing of the process. The key is to take advantage of the timing of current and future projects. For example, if a contractor has recently completed a large-scale project this will assist in achieving its classification (or a higher classification than it may have been previously eligible for). In such circumstances an application for classification should be made a priority in order to capitalise on the company's experience. Likewise, if a contractor is expecting to commence a project which would strengthen its experience, it may be wise to wait for the project to be completed or well advanced in order to utilise this experience when seeking classification. Of course remembering the new deadline, allowing sufficient time to complete the project and to process the application is extremely important. Companies should evaluate their current projects and select a time that is most advantageous in completing the classification process in a way to present the strongest case.
For a detailed summary of the classification regime, please refer to our previous article click here.
If you would like further information on any issue raised in this update please contact Niall O'Toole.
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