E-Invoicing: All You Need to Know

As the efficiency of processes increases through the implementation of platforms for the dematerialized management of document flows, there is a growing need to eliminate the interruption of workflows due to invoicing processes within the European Union. But how are platforms and regulations evolving to guarantee the digital exchange of documents and what is the role of PEPPOL in the present and future of public procurement ?

E-Invoicing: All You Need to Know

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The impetus given by the Coronavirus emergency to the digitisation of business processes is also likely to have a significant impact on the success of European e-invoicing. The reason is simple: as efficiency increases through the implementation of platforms for the dematerialized management of document flows – whose adoption is being triggered by the need to respond to the rules of social distancing – the need to eliminate the interruption of workflows due to invoicing processes within the Union will also increase.

PEPPOL and the future of e-invoicing in Europe

PEPPOL (Pan European Public Procurement Online) is the platform at the service of European countries that have already activated electronic invoicing. The pilot program was launched in 2008 by the European Commission, with the aim of identifying a set of infrastructural elements and technical specifications that would become the basis for the creation of a single market , an invoicing tools to take full advantage of the UBL 2.1 standard and standardize the language of invoice exchange throughout Europe. PEPPOL, in fact, is the network infrastructure that allows the issuance of documents (price lists, transport documents and digital orders in addition to actual invoices), allowing the most innovative European companies to exchange documents as easily as possible with EU bodies, public and private, through access points provided by certified service providers.

Phase one ended in 2012, when the OpenPEPPOL association took over the governance of the key components of the system, leaving it to the national authorities to promote and regulate the service. The basic elements of the PEPPOL ecosystem are the eDelivery Network Infrastructure, the PEPPOL Business Interoperability Specifications (BIS) and the agreements governing the use of the network, i.e. the Transport Infrastructure Agreements (TIA).

how does PEPPOL work ?

European e-Invoicing is based on a four-node architecture that connects all participants in the process: the sender of the document and its PEPPOL Access Point, the recipient’s Access Point and, of course, the recipient himself. The Access Points are matched by the Service Metadata Publisher (SMP), which guarantees the address of the recipient and verifies their willingness to receive the electronic invoice.

In practice, a company that wants to issue a PEPPOL electronic invoice to a foreign customer only has to use an Access Point Provider to activate an account. This is done by simply obtaining the PEPPOL details of the entity receiving the invoice, accessing the dashboard provided by the provider, filling in the document, entering the code for the recipient and sending it to your Access Point, which processes it and forwards it to the recipient’s Access Point. Finally, the recipient receives a notification when the document has been delivered to his hub and is ready for download.

E-Invoicing: All You Need to Know

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Benefits of the PEPPOL system for companies

In the coming years PEPPOL, it will prove essential not only to facilitate exchanges between companies and bodies at pan-European level, but also and above all to generate a range of tangible benefits for all types of organisations, whether private or public. Just think of the reduction of bureaucracy and the reduction of costs related to the issue, transmission and storage of invoices that will generate the introduction of a common certified standard. A process that will support the demand for technological innovation of businesses and public administrations in the areas of document management and automation of workflows. With the possibility, thanks to the analysis of data extracted from each digital document, to develop an even more extensive and more mature vision of the business undertaken on foreign markets with international partners.

Beyond European e-invoicing: the future scenario

In addition to Peppol, the future of European document management could also be entrusted to new disruptive technologies. Among others, the blockchain will certainly be a game changer in the industry. It is a not yet mature innovation, which theoretically has all the characteristics to be applied to commercial document exchanges.

Investment in the sector is not lacking, given the potential business. In fact, it is estimated that the electronic invoicing market will be worth sixteen billion in the coming years. Many countries around the world are rapidly implementing new document processes, such as India and Singapore. The situation is therefore evolving: European e-invoicing is another step towards an increasingly digital future.

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Author: Vincenzo Cirillo

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