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e-Invoicing (RP2023)

(A.) Policy and legislation

(A.1) Policy objectives

Electronic invoicing (eInvoicing), as defined in Directive 2014/55/EU, is the process through which an invoice that has been issued, sent and received in a structured electronic format which allows for its automatic and electronic processing; it brings numerous benefits to all users (senders, and recipients, service providers, tax authorities, etc). By automating the relevant business processes, eInvoicing leads to cost savings, increased efficiency, faster payments, and a reduced environmental impact especially if other business documents like order and dispatch advice are also available in electronic format.  Its deployment is a strong tool in support of enterprise and financial policies as it makes enterprises more efficient and generates potentially significant savings for Member States’ governments. Electronic invoicing can improve tax compliance and is an effective tool to reduce tax frauds, in fact its adoption also in the private sector transactions (B2B) is increasing worldwide, often by legal obligation and with proprietary formats.  The broadest take-up of eInvoicing in Europe, the extension of the use of the European Standard to B2B, B2C and at an international level and making the European standard fit for use according to all upcoming Commission e-Invoicing related policies, such as the use of eInvoicing for VAT reporting, are the main objectives for the coming period.

(A.2) EC perspective and progress report

By specifying the semantic data model of the core elements of an electronic invoice, the published European standard EN 16931-1 and its list of syntaxes in Annex is intended to tackle the semantic fragmentation that is a side effect of the vast number of e-Invoicing standards, data formats, and usage requirements that exists across the EU and globally. The standard model preserves the necessary flexibility through Core Invoice Usage Specifications (CIUS) and extensions. It is important to promote the standards in order to facilitate interoperability while respecting different sector needs and practices. On the same basis, it should also be possible, by new standardisation activities, to support the adoption of e-Invoicing for B2B and B2C (e-receipts) and at an international level while ensuring the use of eInvoicing and the European Standard for VAT reporting obligations, as foreseen in the upcoming Commission legislation on this topic.

The Commission has addressed the issues around e-Invoicing also on the political and legal level:

  • Directive 2014/55/EU obliges central government bodies of the Member States, in public procurement, to accept electronic invoices compliant with the European Standard.
  • In its work programme for 2022, Annex II under the section REFIT Initiatives, the Commission announced that it will put forward a legislative proposal for 2022 under the heading ‘VAT in the digital age’, also covering VAT reporting obligations and e-Invoicing. On 8 December 2022, The Commission published a legislative package composed of several pieces of legislation, around the "Proposal for a Council Directive amending Directive 2006/112/EC as regards VAT rules in the Digital Age"
  • The Commission will review the effects of Directive 2014/55/EU on the internal market and uptake of e-Invoicing in public procurement and submit in 2023 a report to the European Parliament and to the Council (as foreseen in Article 12 of the Directive).
(A.3) References
  • Directive 2014/55/EU of the European Parliament and of the Council on electronic invoicing in public procurement. This Directive obliges central government bodies of the Member States of the European Union to accept electronic invoices in public procurement from 18 April 2019 onwards; and Member States were able to postpone the obligation for local authorities until 18 April 2020. These electronic invoices must comply with the European standard on electronic invoicing (EN 16931-1), and with one of the syntaxes on a limited list specified in CEN/TS 16931-2.
  • "Proposal for a Council Directive amending Directive 2006/112/EC as regards VAT rules in the Digital Age"
  • Council Directive 2010/45/EU amending Directive 2006/112/EC on the common system of value added tax as regards the rules on invoicing.
  • SWD(2013) 222 — Impact Assessment accompanying the document `Proposal for a Directive of the European Parliament and of the Council on electronic invoicing in public procurement´
  • COM(2013) 453 final on end-to-end e-Procurement to modernise public administration
  • Explanatory Notes on VAT-invoicing rules (Council Directive 2010/45/EU)
  • Council Directive 2006/112/EC on the common system of value added tax.
  • COM(2010)712 “Reaping the benefits of electronic invoicing for Europe” describes a number of actions in different areas, including standardisation, needed to facilitate the deployment of e-Invoicing in Europe.
  • COM(2012)179 “A strategy for e-procurement” states that the ultimate goal is “straight through e-procurement” with all phases of the procedure from notification (e-notification) to payment (e-payment) being conducted electronically.
  • Commission Implementing Decision (EU) 2017/1870 of 16 October 2017 on the publication of the reference of the European standard on electronic invoicing and the list of its syntaxes pursuant to Directive 2014/55/EU
  • Commission work programme 2022, Annex II, includes the “VAT in the digital age” initiative, which aims to modernise the current VAT rules, taking into account the opportunities offered by digital technologies. The initiative covers 1) VAT reporting obligations and e-Invoicing 2) VAT treatment of the platform economy and 3) single EU VAT registration.

Several European countries already introduced rules whereby public authorities could only accept electronic invoices from suppliers, and all these initiatives will need to align with the ongoing standardisation activities carried out by CEN/TC 434 according to the Annex of the standardisation request M/528.

(B.) Requested actions

The deliverables defined in standardisation mandate M/528 have been published. The European Norm EN16931-1 (European Standard) and its complementary technical specifications and reports are available.  CEN/TC 434 should pursue work on ensuring that the European Standard is aligned with the most recent Commission policies, as the 2020 one on VAT digital Reporting and discuss further follow up activities leading to wider adoption and implementation of eInvoicing / automated processes.

Action 1: Continue the work in CEN/TC 434, which includes the following aspects and standardisation deliverables, currently under development:

  • ensure the EU standard is “fit for purpose” to serve a coherent eInvoicing policy in the EU, especially in line with the new requirements coming from the EU legislation for tax reporting based on eInvoicing
  • maintenance activities
  • preparation of the Amendment to the European Standard
  • development of standardisation documents that support and encourage the uptake of the European Standard and its ancillary deliverables
  • communication activities (Capacity building) also addressing third countries at global level
  • development of a standard supporting e-receipts, based on the European Standard on electronic invoicing.
  • following the market and technological evolution in e-Invoicing, ensure an active link with the work on Blockchain, in liaison with CEN/CENELEC/JTC 19 on Blockchain and Distributed Ledger Technologies.

Action 2: For electronic invoices related to ICT services addressing end users, attention should be paid to the relevant Human Factors requirements (e.g. language understandability and consistency and accessibility). Aspects such as clarity and ability to perceive of information structures and content, use of unambiguous, harmonised terminologies and standardised formats and information attributes and details should be considered for current and upcoming ICT services. ETSI has already addressed certain aspects related to the usability and accessibility of the basic elements (e.g. in Smart City environments) and on the general level;  the ESOs, MSP, consortia and standards bodies should coordinate and initiate work to develop recommendations addressing the requirements and user experience of e-Invoicing in digitised environments (covering applicable usability and accessibility aspects related to those attributes and context of use).

Usability ensures the accuracy of the information content of e-invoices and e-receipts which are main documents for real time economy. Usability make invoice and receipt data reliable and so allows automatic processing of invoice and receipt information in the buyer's various financial management systems and reporting (once only principle) without manual processing.

General remark: Overall, the actions should be part of an agreed standardisation strategy shared by the Commission, the ESOs, MSP, consortia and standards bodies supplying specifications in use, and Member States which actively implement them.  The Commission may launch further broad, neutral fact-finding inquiries (perhaps via the MSP) to identify appropriate shared needs and goals.

(C.) Activities and additional information

(C.1) Related standardisation activities
CEN

CEN/TC 434 —   "Electronic Invoicing" — was established to provide standardisation for e-Invoicing and to undertake the standardisation activities required by the Directive 2014/55/EU.

CEN/TC 440 —   "Electronic public procurement" — was established in order to provide standardisation in the field of e-Procurement including post-award processes.

CEN/TC 445 —   "Digital information Interchange in the Insurance Industry" — has started the development of a new standard for the electronic invoice of the insurance premium, based on EN16931-1. Work on FprCEN/TS 17901:2022 - Electronic Premium Invoice - Mapping to Electronic Invoice EN 16931-1:2017 is being finalized.     

OASIS

The OASIS Universal Business Language (UBL) TC defines a common XML library of business document types supporting digitization of the commercial and logistical processes for domestic and international supply chains. Version 2.1 (UBL v2.1), used in several Member States and in OpenPeppol, was adopted as ISO/IEC 19845:2015. An updated UBL version 2.3 was published as a OASIS Standard in June 2021.  It provides standards for service location (BDXL 1.0) and capability lookup (SMP 2.0) that can be used together with a message protocol like AS4 (as used in the European Commission's eDelivery Building Block and in OpenPeppol) and an Exchange Header Envelope schema (XHE 1.0).

The OASIS Business Document Exchange (BDXR) TC is defining specifications for a federated document transport infrastructure for business document exchange.

UNECE

The United Nations Centre for Trade Facilitation and Electronic Business (UN/CEFACT) Cross Industry Invoice version 16A is a maximum data set invoice model which aims to cover all potential needs of any industry and any transaction. Each implementation is therefore a subset of the overall standard, but extensions should not be necessary as every aspect is intended to be covered by the standard. This standard is re-released twice a year, but always backwards compatible with the official 16A version.

This standard is based on an overall Reference Data Model which brings direct links to electronic messages for all other supply chain operations.

See: https://www.unece.org/uncefact/mainstandards.html#ui-accordion-jfmulticontent_c66359-panel-1

ETSI

ETSI TC Human Factors is responsible for all Human Factors matters related to the usability and accessibility of ICT products, applications and services. Special care is paid to all aspects related to interfaces and interaction with the user. Human Factors is the scientific application of knowledge about human capacities and limitations in order to make products, systems, services and environments effective, efficient and easy for everyone to use.

SC USER Group has published TS 102 845 Requirements for Check-up on Metering and Billing Processes and associated documents for the implementation of this TS.

IEEE

IEEE  P2142.1 -  Recommended Practice for E-Invoice Business Using Blockchain Technology.

For further details please see https://ieeesa.io/eu-rolling-plan

ITU

Under ITU-T SG3, Recommendation ITU-T D.198, “Principles for a unified format of price/tariffs/rates lists used for exchanging telephone traffic”, recognizes the right of any operator to present price/tariffs/rates charged for telecommunications services in any form deemed convenient for the operator. It additionally recommends that telecommunications companies offering international connections/exchange of traffic make use as far as possible of the same templates/forms/format of data to represent traffic destinations and offered price/tariffs/rates including if required optional clarifying information or quality of service criteria. ITU-T D.198 also identifies the mandatory and optional specifications of price list electronic spreadsheets and advocates for the coordination between parties not only to define QoS information but also to ensure smooth spreadsheet processing.

See: https://www.itu.int/rec/T-REC-D.198-201905-I

Under ITU-T SG16 a new work item to draft a new Recommendation H.DLT-INV “General framework of DLT-based invoices” was approved, aiming to publish it during 2021.

See: https://www.itu.int/ITU-T/workprog/wp_item.aspx?isn=16367

(C.2) Other activities related to standardisation
OpenPeppol

Supports e-Invoicing developer community to implement the Peppol specifications.  The Peppol transport infrastructure is today implemented by hundreds of service providers throughout Europe, servicing thousands of public and private entities, specifically in the post-award processes of e-Procurement, where e-Invoicing is predominantly used.

https://peppol.eu/about-openpeppol/

(C.3) additional information

The emergence of an abundance of internet and mobile based payment services for both online and over-the-counter purchases makes it increasingly important to also standardise formats and delivery methods for business-to-consumer (B2C) e-billing.  Business-to-government (B2G) and business-to-business (B2B) e-Invoicing formats are not directly applicable to invoices and receipts issued to consumers. Most importantly, there are privacy issues to be considered with respect to content and delivery. Standardised e-billing for B2C commerce could have a number of benefits including faster and simpler payments and reduced environmental impact for mobile over-the-counter purchases; more readily accessible to users with disabilities; consumers can collect invoices in a single location, easily accessible for warranty and ODR purposes; easily accessible and portable e-Invoices may be used to increase trust in relation to second-hand C2C trading. However, e-Invoicing in multiple formats, where the consumer would have to register in many different ways with various vendors and/or data mining third-party services to receive invoices in various formats or become embedded in proprietary apps, would be detrimental to the objectives of the digital single market. 

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