What do you think has held back the progress of mass e-invoicing adoption? Does it have to do with the impact of EU Directive 2010/45 on local regulations?
The EU Member States implemented the EU Directive in 2013 and they started treating paper invoices and their electronic counterparts equally. However, some countries have locally implemented their own restrictions, which makes the international e-invoicing projects more complicated. Taking into account that enterprises have been looking for e-invoicing solutions covering the projects on several markets/regions to receive the synergy effect, it turns out that keeping these solutions compliant with these local specificity are both time-consuming and money-consuming. In Portugal, for example, the invoicing software must be locally certified by the tax authority. This requires extra development and implementation effort. Similarly, in Hungary, the exportability in specific format or invoices preservation in Italy are only some of such ‘local’ functionalities. Managing a project like this one requires deep legal knowledge and constant updates. Moreover, Spain and Lithuania are about to implement their own reporting file formats.
Thus, it would be recommended for EU decision makers to re-consider the e-invoicing strategy and avoid wasting years on preparing EU Directive 2010/45/EU and elaborating a common approach. The hot topic is the availability of audit files and scope of the reporting – the sooner the decisions are taken the faster is the growth rate of cross-border e-invoicing. The focus should also be put on convincing SMEs – they are aware of advantages of e-invoicing, but are reluctant to invest resources without certainty about future legislation.
In the event of a tax audit, how could a company make sure that it has what it takes to validate the integrity and authenticity of an invoice?
The answer depends on what method has been chosen by the taxable person to assure the authenticity and integrity – the Directive 2010/45/EU gives freedom to the parties to choose how they assure integrity and authenticity.
Many companies, especially those with high volumes, choose electronic data interchange (EDI), through which the structured format message becomes the original one and also enables automatic processing by the recipient. In this case, the parties sign the EDI agreement, which describes the procedures, specifications, and formats, as well as technical communication details. Most of the companies using EDI also exchange other types of messages via this technology (e.g., order, dispatch advice, receipt confirmation), and improve the end-to-end process verification by tax auditors. In addition, the readable format must be assured for the archived documents.
Electronic signature is commonly used worldwide. The EU has adopted a new regulation (coming into force on 1st of July 2016), which introduces a new legal framework for electronic signatures, seals, timestamps, etc. The new solution aims to ensure uniformity within EU and also solve the issue with different national rules on electronic signature.
The third implemented method is the possibility to use business controls that set up a reliable audit trail between the invoice and the supply for the entire retention period.
What is predicted regarding e-invoicing in the coming years?
The public administrations in the EU will be obliged to support e-invoicing (the standards will be indicated in 2017) by the end of 2018. In many countries, the projects have already started and, as most of the experts agree, it should be a significant milestone in increasing e-invoicing penetration, due to the fact that approximately 30% of companies cooperate with public authorities. Moreover, rumor has it the next step will be the mandatory exchange of e-invoices with public organisations.
What are the pillars of successful e-invoicing interoperability?
The right business approach is crucial at this specific point. The leading providers in various countries are skeptical about opening the market for newcomers. However, as in case of telecoms, the operators should allow the cooperation and start offering a support for additional processes, as well as value added services. The initiatives similar to the one promoted by EESPA members (to elaborate the Multilateral Interoperability Framework Agreement with all the legal and technical aspects) should improve the cooperation and the e-invoicing system, especially at the international level.
About Bartlomiej Wojtowicz
He has over 10 years of experience in the field of B2B communication in the supply chain. Initially responsible for the EDI market development in Southern and Central Europe, he is currently responsible for the development of Comarch EDI portfolio.
About Comarch EDI
Comarch EDI is a B2B platform, which provides a competitive advantage by a fast and secure data exchange with business partners. The solution provides the automation of data processing throughout the supply chain: from the procurement process, through the logistics, to invoicing and payment processing.
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