1. e-Invoice implementation challenges in EU Christian Vindinge Rasmussen Senior Advisor, Agency for Public Management and eGovernment (Difi) Belgrade Chamber of Commerce 25 th of May 2013

2. e-Invoices – big potential… Austria 6-8 mio. euro in savings per year - only by processing the invoice Denmark 90mio. euro in savings per year by full electronic handling of invoices Ireland 246mio. euro in savings per year in est. savings by full electronic handling of invoices Finland 29-49 euro in savings per invoice by full electronic handling EU 240 billion euro in savings over 6 years by mass adoption of e- invoices DatoDirektoratet for forvaltning og IKT

3. …but hard to realize: More than 150 billion invoices per year worldwide (est. 2012) …but only 3 billion is electronic e-Invoices (est. 2012) …Europe (especially Scandinavia) is leading in B2G e-invoices …US is leading in B2B, B2C e-invoices Moderate market penetration despite solid business cases as seen in the slide before DatoDirektoratet for forvaltning og IKT

4. Many barriers… Standards & Formats Business models Legislation e-Invoices alone World economy Islands of procurement DatoDirektoratet for forvaltning og IKT

5. Many standards and formats Global standards ebXML, OASIS UBL2.0, UBL2.0 NES Subset, UN/CEFACT Local/regional standards OIOXML (Denmark), BMF (Belgium), Finvoice (Finland), Svefaktura (Sweden), EHF (Norway) Mappings between all these standards are needed to create interoperability between the sender and receiver of e-Invoices Many e-invoicing suppliers support only 1 standard DatoDirektoratet for forvaltning og IKT

6. Complicated business models The e-Invoice service providers have very different business models of e-Invoicing: Fixed pricing per invoice Fee per supplier Fixed subscription Per invoice percentage fee Nearly impossible to support all business models for the client All parties in the ”four corner model” has to benefit from implementation of e-Invoice DatoDirektoratet for forvaltning og IKT

7. National and International legislation Many countries now has mandatory e-Invoice legislation (Denmark, Norway, Sweden, Austria to name a few) Most of the legislation supports national standards of e-Invoicing and not the international standards. Difference in requirements to the format of the invoice – eg. VAT number, TAX id, eSignatures But never the less legislation pushes mass adoption of e-Invoices nationally and internationally! DatoDirektoratet for forvaltning og IKT

8. e-Invoices is not a silverbullet! Most clients think e-Invoices is the solution to their problems and foster great savings, but many things will follow: Business processes has to be changed and standardized Acknowledgement from receiver and sender is needed Other eDocuments will be needed like eOrders, eCatalogs, notifications, tracking etc. Increased need for support with end-to-end tracking - SLAs Bilateral agreements between sender and receiver – not just plug and play! DatoDirektoratet for forvaltning og IKT

9. World economy Many countries still suffers from a economic lockdown Even cost-saving implementations like e- Invoicing is halted Many countries want measurements against fraud and corruption but very few are capable of acting upon it today DatoDirektoratet for forvaltning og IKT

10. e-invoices today is part of isolated implementations Many service providers offers: Few standards and formats Local but highly specialized legislation knowledge No cross-border interoperability High entry fees – low transaction fees e-Invoice as part of a total procurement package This is called Islands of Procurement! DatoDirektoratet for forvaltning og IKT

11. Islands of procurement DatoDirektoratet for forvaltning og IKT

12. www.peppol.eu PEPPOL is owned by OpenPEPPOL AISBL Pan-European Public Procurement Online (PEPPOL) and the role of OpenPEPPOL

13. PEPPOL is owned by OpenPEPPOL AISBL The PEPPOL Vision The PEPPOL vision is: “To enable businesses to communicate electronically with any European government institution in the procurement process, increasing efficiencies and reducing costs.” The PEPPOL project (2008-2012) was launched to address the key eProcurement challenges in Europe. It has been jointly funded by the EC and a consortium of 18 government agencies from 11 member states

14. PEPPOL is owned by OpenPEPPOL AISBL PEPPOL Components: focus on the critical phases PEPPOL Pre-award focus: eAttestation (VCD), eCatalogues, eSignature validation, potential use of PEPPOL Transport Infrastructure PEPPOL Post-award focus: eCatalogues, eOrdering, eInvoicing and Transport Infrastructure. Potential use of eSignature validation and eAttestations

15. PEPPOL is owned by OpenPEPPOL AISBL PEPPOL E-Invoicing use – examples Austria: From 2014, suppliers of the Federal government will be obliged to use eInvoicing. Use of PEPPOL eInvoicing specifications and network is one of the two options allowed, for domestic and cross-border transactions. Denmark: National eInvoicing platform – NemHandel/EasyTrade (mandatory since 2005) is PEPPOL enabled. Ireland: 7 active PEPPOL Access points with transactions across borders. Norway: From July 2012 the government mandated use of eInvoicing in B2G based on PEPPOL specifications. PEPPOL network recommended. Vast majority of central government organisations can receive PEPPOL-based eInvoices. Sweden: Public sector Invoicing and eOrdering mandated. PEPPOL specifications and network recommended for cross border use. The European Commission implemented its own eProcurement platform (ePRIOR) based on PEPPOL specifications.

16. PEPPOL is owned by OpenPEPPOL AISBL EC e-invoicing Roadmap and Actions EC Roadmap for electronic invoicing in public procurement: Main problem to be addressed: Multiple Standards imposed by Member States. Policy approach considered as the most effective: Legislative Act: possibility of making e-invoicing mandatory in public procurement, mandating the use of specific standards to ensure interoperability. Single Market Act II – Key Action 10: “Make electronic invoicing the standard invoicing mode for public procurement.” The introduction of legislative measures making e-invoicing a standard practice in public procurement will make the public sector a 'lead market‘ for e-invoicing and spearhead its wider use in the economy. A Strategy for e-Procurement: “Support the deployment of e- procurement infrastructure, ensuring support for the sustainability of the PEPPOL components from mid-2012.

17. PEPPOL is owned by OpenPEPPOL AISBL OpenPEPPOL AISBL The PEPPOL project reached a successful completion, 31 st of August 2012. OpenPEPPOL AISBL* has been operational from 1 st of September 2012, taking over ownership of PEPPOL results and governance responsibilities. OpenPEPPOL’s goals are: Encourage European governments and their suppliers to continue implementing eProcurement using the PEPPOL specifications, promoting best practices Ensure that the PEPPOL network continues to grow in an open, accessible and compliant manner, supporting interoperability for European public services and helping Europe move towards a Digital Single Market Encourage the development of innovative PEPPOL-based ICT products and services supporting public procurement processes, fostering their use also in the B2B context * OpenPEPPOL is an international non-profit organisation under Belgian law founded by former PEPPOL consortium partners, with membership open to public and private organisations.

18. PEPPOL is owned by OpenPEPPOL AISBL OpenPEPPOL organisational model Page 18

19. PEPPOL is owned by OpenPEPPOL AISBL The role of OpenPEPPOL OpenPEPPOL offers solutions for Pan-European eProcurement interoperability in Post-award procurement processes: PEPPOL Transport Infrastructure (EU-wide addressing, reliable messaging) PEPPOL Business Interoperability Specifications (PEPPOL BIS) PEPPOL Transport Infrastructure Agreements (many-to-many regime) OpenPEPPOL offers solutions for eAttestation (VCD), eCatalogues and eSignature validation and, in close cooperation with e-SENS and CEN BII3, will continue to enable Pan-European eProcurement interoperability in Pre- award procurement processes, including also e-notifications OpenPEPPOL AISBL offers governance and life cycle management for PEPPOL solutions, ensuring long time sustainability of PEPPOL results OpenPEPPOL AISBL is operational from 1 st of September 2012. Membership is now open to a wide range of public and private organisations Page 19

20. www.peppol.eu PEPPOL is owned by OpenPEPPOL AISBL Join the OpenPEPPOL community! For more information: E-mailinfo@peppol.euinfo@peppol.eu Web addresswww.peppol.euwww.peppol.eu

21. THE NORWEGIAN EXPERIENCE Agency for Public Management and eGovernment

22. Facts regarding Norway Many small businesses 201.000 businesses with employees – 98 percent are small and medium sized (from 1 to 100 employees) 240.000.000 invoices covering B2B and B2G From late 1990’s, electronic workflow based on scanned paper invoices has become the most commonly used invoice handling mechanism in the public sector eInvoicing solutions before 2011 VAN operators Bank solutions In 2011 the Ministry of Government Reform and Church Affairs issued a Circular mandating use of e-invoicing and recommending PEPPOL Standardised business processes Standardised information content (semantics) Standardised business document formats Standardised transport infrastructure (eDelivery mechanism) No interoperability Agency for Public Management and eGovernment

23. The eInvoicing project Target July 1 st, 2011 Norwegian central government entities and regional health authorities shall be able to receive electronic invoices in standard format (EHF) Target July 1 st, 2012 All central government entities and regional health authorities shall require electronic invoices from their suppliers in standard format (EHF) Targets 2013 and onwards Increase use of EHF-based invoicing among central government entities, regional health authorities AND municipalities Introduce EHF in other parts of the procurement process Agency for Public Management and eGovernment

24. 2 436 2 005 1 560 1 302 885 778 622 432 2 981 3 508 Number of entities that can receive EHF invoices Agency for Public Management and eGovernment

25. 31 078 15 296 8 551 4 975 1 975 41 517 63 579 74 993 Strong increase in number of transactions Agency for Public Management and eGovernment

26. EHF status and further development EHF in production Invoice Credit note Reminder EHF in piloting Catalogue (  July 2013) Order (  September 2013) EHF in development Dispatch advise Mandating eInvoicing through EHF was the starting point In 2013, EHF and use of PEPPOL will be introduced as an alternative to the existing Norwegian e- procurement platform Mandatory use of e- catalogues and e-ordering from 2015? Agency for Public Management and eGovernment

27. Conclusions

28. Learning points (I) Involve Big public sector users Service providers eInvoicing system providers ERP vendors Encourage competition “Top 10”: Published on Difi webpages Agency for Public Management and eGovernment Some of the 31 Norwegian Access Point (AP) providers

29. Learning points (II) Mandating eInvoicing through legislative means is the most powerful tools you can use …if combined with Standardisation of Business processes Information content (semantics)EHF  PEPPOL BIS  CEN BII Business document formats Transport infrastructure (TI)ELMA/SMP, APs  PEPPOL TI...based on international standardisation efforts and European cooperation Agency for Public Management and eGovernment

30. Get started... Public sector use of e-Invoicing benefits both government and businesses In Norway B2B use of EHF has already outgrown B2G use EC is considering to introduce legislative measures making e-invoicing a standard practice in public procurement and make the public sector a 'lead market‘ for e-invoicing and spearhead its wider use in the economy e-Invoicing in public procurement is a good starting point for a wider public e-procurement strategy implementation Use of PEPPOL reduces risk and cost as operational solutions are available and lessons can be learnt from early implementers such as the Scandinavian countries Agency for Public Management and eGovernment

31. Thank you for your attention christian.rasmussen@difi.no +47 902 96 319 @vindinge