Important developments are underway in the promotion of e-invoicing in public procurement. Under the Directive 2014/55/EU, Member States must ensure that all public sector contracting authorities are able to receive and process electronic invoices from suppliers which follow a new European standard for an e-invoice. This will happen over the next three or four years and is a major opportunity for encouraging e-invoicing adoption.
E-invoicing is supportive of public policy priorities such as deficit reduction, financial transparency and sustainability, and will specifically make a material contribution to public sector cost reduction and efficiency. Moreover, it will provide benefits to private sector suppliers.
The European Union and the Member States have in recent years taken some steps to promote e-invoicing as a public policy priority in support of the Single Market and Digital Agendas. For instance, the EU has funded important building blocks and initiatives such as PEPPOL and the CEF programme, to support the adoption process. With this clear public policy support, European public administrations of all kinds are getting ready to adopt e-invoicing on a broad scale.
The new standard
Directive 2014/55/EU provides a clear definition of an electronic invoice: an invoice that has been issued, transmitted and received in a structured electronic format which allows for its automatic and electronic processing;”
The Commission has requested CEN, a key European standardisation organisation, to draft a European standard for the semantic data model of the core elements of an electronic invoice. CEN has created a CEN Technical Committee - CEN TC434 - to carry out the work. The ‘semantic data model’ will be a structured and logically interrelated set of terms and their meanings relevant to the business functions of an invoice. To ease the use of such standard, the Commission has also requested CEN to provide a limited number of syntaxes which follow the European standard on electronic invoicing, the appropriate syntax bindings and guidelines on transmission interoperability. ‘Syntax’ means the machine-readable language or ‘dialect’ used to represent the data elements contained in an electronic invoice and for structuring messages based on the ‘semantic’ data model.
The European standard is now under preparation in the CEN TC 434 and will be approved and published by the early part of 2017:
The benefits of electronic invoicing are maximised when the generation, sending, transmission, reception and processing of an invoice can be fully automated. For this reason, only machine-readable invoices which can be processed automatically and digitally by the recipient should be considered to be compliant with the European standard on electronic invoicing. A mere image file should not be considered to be an electronic invoice for the purpose of the Directive.
To read Charles Bryants suggestions on how public authorities should respond, please download the B2B Fintech: Payments, Supply Chain Finance & E-invoicing Guide 2016.
Charles Bryant is Secretary General of EESPA and also active in the Global Supply Chain Finance Forum.
About EESPA The European E-invoicing Service Providers Association acts as a trade association at European level for a large and dynamic community of e-invoicing service providers, drawn from organisations that provide network, business outsourcing, financial, technology and EDI services. EESPA is an International Not-for-Profit Association organised under Belgian law. Formed in 2011 it has over 60 full and associate members and is involved with a range of important initiatives in interoperability, the public policy debate, and promoting adoption.
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