A general trend to replace traditional paper invoices with electronic versions has become increasingly clear over recent years. It gives national governments greater control over VAT tax collection and helps entrepreneurs make accounting processes in their companies more efficient and cheaper.
LATAM leads by example
Latin America is undoubtedly the region in which the use of electronic invoicing is most widespread, and where the most entrepreneurs are obliged to issue e-invoices. Most LATAM countries, including Argentina, Brazil and Uruguay, decided a couple of years ago to implement compulsory electronic invoicing in dealing with public administration entities. In countries such as Bolivia and Colombia, the obligation to use electronic invoices is being dynamically extended to new groups of businesses, with the aim being the total elimination of paper invoices from the accounting processes.
... and has been teaching Europe
In Europe, April 18 2019 will mark a major step towards electronic invoicing. This is the deadline for implementation of Directive 2014/55/EU by all EU Member States. As of this date, all European public administration bodies are required to be ready, at least in terms of public procurement, to receive structured electronic invoices from their suppliers.
In fact, certain Member States have already extended the e-Invoicing obligation for all transactions with the public sector on their territories. The governments of Belgium, the Netherlands and Spain have all decided to create dedicated e-invoicing platforms. On January 1st, 2019, based on the successful experiences of Latin America, Italy became the first EU country to introduce mandatory use of electronic invoices in B2B transactions. Meanwhile, the European Commission reports a lack of information on actions taken to implement Directive 2014/55/EU by the Bulgarian and Romanian Governments.
Global projects, local challenges
International companies, which must implement local solutions adopted by Member States in order to comply with e-invoicing legislation, face a particularly challenging situation. Setting up an efficient and global business mechanism in this area often requires a dynamic adjustment in order to meet the specific national requirements for acceptable document formats, mandatory electronic signatures placement on invoices, and the use of specific communication channels with the government platform.
Legal compliance as the key to success
The need to adjust solutions to meet local requirements, ensuring legal compliance with rules for issuing and archiving digital invoices is a particular hurdle for international companies. Therefore, Brazil introduced three types of e-invoices, Portugal requires certified software for issuing electronic invoices, and Italy demands compliance with the national Fattura XML format and connection to the government SDI platform. In Taiwan and Turkey, electronic invoicing is compulsory only for businesses in certain sectors.
PEPPOL and the national e-invoicing platforms
In order to meet the needs of companies involved in international projects during the process of adopting mandatory e-invoicing in dealing with public administration entities, other countries have opted for compliance with the global standard, developed by the European Committee for Standardization (CEN). Thereby, entrepreneurs are able to transmit electronic documents via the PEPPOL Network, which ensures effective communication with any public administration entity in the EU during a public procurement process. The imminent adoption of the PEPPOL-based electronic invoicing solution was recently announced in Sweden, where the compulsory use of e-invoices in B2G transactions is coming into force in April 2019, and Croatia, where companies will be obliged to issue e-invoices when dealing with government administration bodies as of July 1, 2019. PEPPOL will also improve access to national e-invoicing platforms, including the Polish electronic invoicing platform, PEF.
To learn more about PEPPOL, download PEPPOL: The Background, The Basics and The Benefits.
About Anna Bawól
Anna Bawól is a Compliance Expert at Comarch E-Invoicing. With Master’s degrees in Law and Philology, her professional research is focused on international and constitutional law. Anna is responsible for legal compliance issues and legislative developments monitoring in the global e-invoicing area.
About Comarch E-Invoicing
Comarch E-Invoicing is one of the Comarch brands, which provides cutting-edge technology, allowing the enterprises to automate the supply chain and invoicing processes. A comprehensive approach to both internal and external cloud-based collaboration with all partners (suppliers, customers, logistics operators and service providers), including the exchange of product, merchandising, analitical, logistic and financial data, delivers the best results. Consequently, companies are provided with fast and secure access to reliable data, optimisation of processes with Robotic Process Automation, and lower document handling costs.
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