Official Journal of the European Union

C 318/105

Opinion of the European Economic and Social Committee on the ‘Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions — Reaping the benefits of electronic invoicing for Europe’

COM(2010) 712 final

2011/C 318/17

Rapporteur: Mr IOZIA

On 2 December 2010, the European Commission decided to consult the European Economic and Social Committee, under Article 304 of the Treaty on the Functioning of the European Union, on the

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions — Reaping the benefits of electronic invoicing for Europe

COM(2010) 712 final.

The Section for the Single Market, Production and Consumption, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 23 June 2011.

At its 473rd plenary session, held on 13 and 14 July 2011 (meeting of 13 July), the European Economic and Social Committee adopted the following opinion by 119 votes to 1 with 3 abstentions.

1.   Conclusions and recommendations


The European Economic and Social Committee expresses its support and appreciation to the Commission, and agrees with the content of the Communication, which falls within the scope of the European digital agenda. The modernisation of instruments that manage economic relations and technological innovation not only bring about very significant savings, but also help to disseminate innovation and achieve the objectives set by the Europe 2020 strategy.


The completion of the digital agenda will be a key plank in the relaunch of the single market as a factor of sustainable social and economic development.


The EESC stresses the need to take particular account of the advantages that could arise from widespread dissemination of electronic invoicing. Those benefits will need to be shared fairly amongst all categories of business, but especially SMEs. Particular attention will need to be paid to their specific needs as regards digital literacy, limiting the costs of access to digital platforms and management software.


The EESC calls on the Commission to make every effort to speed up the process of the new legislation on electronic signatures as much as possible, and wonders whether it would not be appropriate to adopt a regulation rather than a directive to avoid problems with diverging transpositions that would maintain different standards in the area.

The reform of the system of indirect taxation (VAT) already takes into consideration equal treatment of electronic receipts with paper ones for the purposes of keeping accounts and invoices. The tax administrations of the Member States should bring their legislation into line with this provision as soon as possible.


With particular regard to SMEs, the EESC recommends that their interests be protected in terms of payment of VAT, which should be linked to the payment of the electronic invoice rather than a certain date of issue. The new system will need to give due consideration to the problems that SMEs may have in managing their liquidity.


The EESC supports the widespread and rapid adoption of electronic invoicing, but believes that this should remain optional and, whilst understanding the aims of such a measure, does not consider that the conditions for making it mandatory are fulfilled.


The EESC recommends to the Commission that the steps necessary to achieve the stated objective be taken with caution and care so as to avoid creating unnecessary and burdensome problems for businesses and consumers.


The coexistence of two schemes with equal legal value, i.e. electronic and paper invoicing, should enable everyone to choose the one that best fits their specific requirements.


The EESC calls on the Commission to adopt global standards for electronic invoicing. The standardisation and interoperability of systems are essential factors for the dissemination and success of electronic invoicing. They will enable the development of the internal market and make it possible to increase the number of operators on the market.

This contrasts with the current situation of a fragmented market characterised by lack of communication, which de facto obstructs the development of this useful instrument at cross-border level.


The PEPPOL pilot project should be rolled out further, permanently connecting those areas where electronic invoicing is already a reality. Greater attention should be paid to the needs of SMEs.


The Communication does not consider the requirements and interests of consumers amongst the recipients of electronic invoicing. Only people who have good experience in using information technology will be able to avail themselves of the convenience of receiving electronic invoices.


The envisaged dissemination of this instrument should make it possible to create a virtuous circle: viewing the online catalogue, choosing and purchase order, despatch of goods, issuing of the invoice, payment with simultaneous transfer to the financial administration of the amount due with the automatic calculation of the applicable VAT rate depending on the type of goods and of operator.


Speeding up these processes will bring about significant savings in time, prompter payments, and a reduction in the number of false invoices.


E-business projects funded by the EU should include a mandatory requirement that a certain percentage of all pilot projects must include small and medium-sized enterprises. This could focus attention on the needs of SMEs right from the initial phases of these initiatives, and above all influence the development of innovative technologies for SMEs (for example for the PEPPOL project).


The European Commission should place more emphasis on the need for national public administrations to adopt the principle of equal treatment between paper and electronic invoices, thus removing the obstacles to cross-border trade. In particular, by removing the obligation to use specific technological solutions (including electronic signatures) that are not necessary for paper invoices, and by eliminating the burden that still exists in some Member States of having to print electronic invoices for tax inspections if all the relevant requirements have been met.


Incentives for SMEs could be developed in cooperation with local public authorities through specific programmes. The involvement of DG REGIO must be considered.


The EESC welcomes the establishment of the European forum on electronic invoicing and is open to taking part in its work.

2.   Introduction


Invoices are key documents exchanged between commercial operators, and between these and end consumers. As well as its primary function as a request from the seller to the buyer for payment for goods supplied or services rendered, an invoice is an important accounting document and has potential legal implications for both trading partners. It is a contractual document in the relations between businesses and consumers. In some countries, the invoice is a key document for tax returns, for reimbursements and for completing import and export declarations.


The parties involved are the buyer and the seller. In certain circumstances the consignor and consignee can be third parties, such as in the case of a carrier or a logistics operator.


Electronic invoicing is the automated process of issuing, sending, receiving and processing invoice data by electronic means. Electronic invoicing is part of an intricate network of business processes and procedures, commonly referred to as the order-to-payment cycle, from the supplier's point of view, and the purchase-to-payment cycle from the buyer's point of view.


Amongst the seven ‘flagship’ initiatives promoted by the European Union with a view to putting the 2020 strategy into practice, A Digital Agenda for Europe deals with supporting, through appropriate regulation, the development of information technologies dedicated inter alia to the simplification and to the reduction of burdens with a view to completing the single market. More than one hundred initiatives and another thirty legislative provisions will be adopted to pursue the thirteen key performance targets over the next ten years.


The Commission communication, published following five years of preparation and in-depth consultation, deals with a very important part of the agenda: electronic invoicing. It sets the objective of electronic invoicing being the main method of invoicing by 2020. It is calculated that currently only 5 % of all invoicing transactions by businesses take place via electronic invoicing.


The Commission calculates that the potential savings could amount to EUR 240 billion over six years (1). The European Association of Corporate Treasurers has arrived at similar results, estimating that businesses could save up to 80 % of their operating costs by moving to automated processing of invoice data, thus eliminating paper consumption and significantly reducing labour. The development of the Single Euro Payment Area (SEPA) could make it possible to combine invoicing and payments, thus allowing for integration of systems and the possibility of setting up interoperable European electronic invoicing schemes.


The priorities identified are:

‘to ensure legal certainty and a clear technical environment for e-invoices to facilitate mass adoption,

to encourage and promote the development of open and interoperable e-invoicing solutions based on a common standard, paying particular attention to the needs of SMEs,

to support the uptake of e-invoicing by setting up organisational structures, such as national e-Invoicing fora and a European Multi-Stakeholder Forum.’

3.   EESC comments and observations


The European Economic and Social Committee (EESC) is a committed supporter of the flagship initiative A Digital Agenda for Europe and welcomes the Commission's initiative. In several previous opinions (2), the EESC has supported the adoption of programmes and legislative initiatives aimed at promoting the use of information and communication technologies (ICT).


More than 30 billion invoices and bills are issued in Europe. In 2011, three billion bills and invoices are expected to be sent by email, but not all of these will be electronic invoices. More than 4,5 million businesses and over 75 million consumers already use this system. The main operators providing electronic invoicing services are doubling their turnover every few months.


Studies carried out by a group of experts on behalf of the Commission have estimated that the saving to the issuer in respect of each invoice can be several euros. Automated electronic despatch can save up to 60-80 % compared to traditional, paper-based processes. In overall terms, this means a saving of between 1 and 2 % of administrative costs. There is an economic return on investment in electronic invoicing systems after just six months, according to assessments by the leading experts in the sector (3).


In the communication, the Commission hopes that electronic invoicing will become the predominant method, but does not state why it should take so long. The EESC considers that every possible effort should be made to achieve this goal as quickly as possible.


The EESC emphasises and welcomes the significant contribution that the development of electronic invoicing can make to reducing CO2 emissions thanks to the reduction in energy used for transport and in paper consumption.


The EESC supports the priority given to SMEs and to the comments made by them in the survey carried out by the expert group appointed by the Commission, and considers this very important.


The EESC recommends that all possible measures be adopted to facilitate the establishment of multiple specialised operators, thus avoiding the creation of little de facto monopolies, which would inevitably take advantage of a dominant position.


The EESC calls on the Commission to put in place such initiatives as may be conducive to implementing and adopting the standard model proposed by the UN/CEFACT (4), the intergovernmental organisation set up by the UNECE Trade Committee to develop a global-level work programme to bring about coordination and cooperation in the field of electronic standards and facilitating business-to-business trade.


The Council should encourage wide uptake of the good practice initiated by some Member States in making electronic invoicing mandatory for public contracts, as this is a useful way of encouraging their dissemination. The PEPPOL (Pan-European Public Procurement Online) project, a large-scale CIP (Competitiveness and Innovation Framework Programme) pilot project supported by the Commission, should be rolled out more widely, and the developed standards adopted and supported, thus connecting those parts of Europe where e-procurement is already a reality.


The EESC welcomes this initiative, but recommends that e-invoicing be made available to other operators, thus opening the market to other players. There are currently around 400 e-invoicing service providers, most of whom operate at local level, providing a wide range of products. Sadly, there is a long way to go before these systems are interoperable. The EESC recommends that common global standards be adopted, as these are key to speeding up the completion of the European single market and sharing its benefits amongst a large number of players, in particular SMEs, by enhancing their competitiveness.


The benefits of uniform invoicing formats are obvious. At present, the market is fragmented and does not communicate. The EESC supports initiatives aimed at converging towards increasingly integrated levels of interoperability and welcomes the fact that the UN/CEFACT CII v.2 (Cross-Industry Invoice) model had been adopted as a basis for developing the ISO 20022 invoice message standard.


Global standards should always make provision for the relevant procurement procedures so as to ensure that businesses are not forced to automate the invoicing process in isolation from that of supply or of order processing, for example. This could lead to inefficiencies. The development of CEN/IIB profiles for the entire procurement chain should be promoted and carefully monitored, given that these form the basis of PEPPOL electronic documents. Particular attention should be paid to the progressive adoption of the UBL standard in various EU Member States, particularly by the public sector. The adoption of such global standards should be encouraged.


In the future, once the system of electronic invoicing is in widespread use, financial administrations will undoubtedly benefit from e-invoicing with payment of VAT contemporaneously with the invoice. Integration with the Single Euro Payment Area could foster greater efficiency of the tax collection system. So as to avoid a negative impact on SMEs, particularly as regards managing their liquidity, the EESC calls on the Commission to take this issue into account.


There will above all be savings in the management of tax returns and in the cost of automatic payments. In general, the fall in collection, verification and management costs of tax services is a modernisation and improvement goal that will benefit the economy as a whole. The reduction in evasion that automating the invoicing process could bring about will ultimately help the system to find resources to reinvest in supporting economic and productive activity.


The EESC recognises the need for an urgent review of Directive 1999/93/EC on electronic signatures so as to introduce a legal system for recognising, at European level, the interoperability of a secure, guaranteed electronic signature. It calls on the Commission to stress the urgency vis-à-vis the Council and the Parliament so that they adopt the provisions soonest. Differences in transposition of the directive and the system's mandatory use in a number of Member States have led to serious problems, especially for SMEs, which consider electronic signatures to be one of the greatest and most pointless obstacles to the adoption of electronic invoicing. With regard to the legislative instrument, the EESC wonders whether the time has come to use a regulation in order to achieve, at long last, uniform standards that meet the expectations set by the Single Market Act.


Europe's citizens do not perceive the opportunities offered by the single market because barriers, bureaucratic hurdles and administrative requirements still remain. Consumers have not yet seen the benefits that were announced with much fanfare, for example in the financial and energy sectors, where it was only European legislation that imposed rules that benefited consumers (Third Energy Package, SEPA, MIFID, etc.).


The EESC considers that the proposal contained in the Commission Communication is a step in the right direction and hopes that the overall pace of the decision-making processes and implementation of the project will quicken, so that workers, citizens and businesses will benefit from a harmonised or, better still, uniform legislative framework.

Brussels, 13 July 2011.

The President of the European Economic and Social Committee


(1)  SEPA potential benefits at stake, Capgemini.


(2)  ‘A Digital Agenda for Europe’, OJ C 54, 19.2.2011, p. 58; ‘Transforming the digital dividend into social benefits and economic growth’, OJ C 44, 11.2.2011, p. 178; OJ C 255, 22.9.2010, p. 116 and OJ C 77, 31.3.2009, p. 60; ‘Improving “participative public – private partnership” models in deploying “e-services” for all in the EU 27’, OJ C 48, 15.2.2011, p. 72; OJ C 255, 22.9.2010, p. 98; OJ C 128, 18.5.2010, p. 69; OJ C 317, 23.12.2009, p. 84, OJ C 218, 11.9.2009, p. 36; OJ C 175, 28.7.2009, p. 8; OJ C 175, 28.7.2009, p. 92; OJ C 175, 28.7.2009, p. 87; OJ C 77, 31.3.2009, p. 63; OJ C 224, 30.8.2008, p. 61; OJ C 224, 30.8.2008, p. 50; OJ C 97, 28.4.2007, p. 27; OJ C 97, 28.4.2007, p. 21; OJ C 325, 30.12.2006, p. 78; OJ C 318, 23.12.2006, p. 222; OJ C 110, 9.5.2006, p. 83; OJ C 123, 25.4.2001, p. 36.

(3)  http://www.expp-summit.com/marketreport.htm.

(4)  UN Centre for Trade Facilitation and Electronic Business.