Should e-invoicing be mandated for the Eurozone?
Umberto Zanini, Director of Technical and Regulatory Research at the Observatory on Electronic Invoicing and Dematerialisation at the Polytechnic of Milan, thinks so.
As we draw nearer to the implementation date of the new e-invoicing directive (2010/45/EU) in January 2013, finance operations professionals are getting increasingly nervous about how this will affect invoice processing on a practical level.
While the directive aims to encourage e-invoicing, the explanatory notes reveal a more liberal approach: not only can companies use EDI, electronic signatures and business controls to ensure the authenticity and integrity of an electronic invoice, but they can use ‘any other technology or procedures’, as long as they meet the directive’s requirements in its entirety.
I spoke to Umberto Zanini, who in his recent paper, ‘The authenticity, Integrity and legibility of electronic invoices in Europe from January 2013’, argues that by adopting the directive without modification and adopting true electronic invoicing, many of the barriers to business in the EU will be overcome.
Zanini argues that e-invoicing can be a powerful enabler in 3 key ways:
- The SMEs who do not have the resource to implement high-tech processes such as EDI will not be excluded, as XML and TXT invoices will not be excluded from automatic approval.
- It will leverage the capabilities of many organisations wishing to adopt supply chain financing or dynamic discounting projects, as e-invoicing enables purchase invoices to be approved efficiently.
- The visibility of spend provided by e-invoicing will allow for the monitoring of public and with simplified VAT legislation, prevent tax evasion.
Zanini admits that mandating e-invoicing, rather than recommending it, may be a drastic and pre-emptive move by the EU, but he believes it to be a genuine option within the next ten years.
How do you think the new directive will encourage e-invoicing in Europe?