Elemica Blog

EU Invoice Compliance

Elemica now offers its supplier management QuickLink Portal customers the ability to completely close the order-to-invoice loop with EU invoice compliance. Suppliers now have the opportunity to send an invoice from the portal - which will be EU-compliant - following all the stringent requirements which must be fulfilled to achieve compliance, including the application of a digital signature. A fully customisable PDF will be generated and sent to the buyer and back to the supplier for archiving purposes.

The Tricky World of eInvoices

Many of you think of Elemica as a provider of electronic purchase orders, confirmations, shipment notices, and order changes. However, we also get involved in helping our clients with electronic invoices – incoming and outgoing, as well as freight invoices from our client's logistics providers.

The US and Canada are fairly lucky in terms of eInvoicing requirements – all you need is a nicely formatted ANSI X12 810 invoice document, or the ChemXML or EDIFACT equivalent, and you’re good to go. In Europe and Latin America, however, things quickly begin to get very tricky.

European Parliament Adopts New Rules

Last year the European Parliament adopted the text of a new directive supplementing VAT Directive 2006/112/EC.*  The result of this adoption appears to be more choice in how to prove the authenticity and integrity of electronic invoices. 

Nothing has changed regarding the high level requirements of electronic invoices – they must still reflect actual supplies and their authenticity, integrity and legibility must be ensured.  (This now applies to paper invoices too, putting electronic and paper invoices on equal footing).

The change this amendment brings is that instead of defining and limiting the ways in which authenticity and integrity can be ensured, it is now left open. In the words of the directive itself:

‘ The authenticity and integrity of electronic invoices can also be ensured by using certain existing technologies … However, since other technologies exist, taxable persons should not be required to use any particular electronic-invoicing technology.’

Invoice Solutions for Materials, Services and Freight

Paper invoices have heavy costs associated with printing, mailing and manual invoice entry - all of which lead to reduced efficiencies. Complexities are also added by the various electronic invoicing regulations and legal requirements throughout the world. Since the goal of invoicing is driving better business by paying in accordance with contract terms and supporting all legal requirements, we see tremendous opportunity to help partners improve effectiveness and remove complexities in their invoicing processes.

Manual data entry, late payments, lost invoices and contract compliance are some of the many problems with paper invoicing. These problems disrupt the cash-to-cash cycle – and this is where electronic invoicing comes in – it’s a necessity for driving cash flow within an organization. Invoicing systems need to be tied to the order processing and freight systems to provide full visibility across the cash-to-cash cycle.