EU MULTI-STAKEHOLDER FORUM ON ELECTRONIC INVOICING ACTIVITY GROUP 2: EXCHANGE OF EXPERIENCE AND GOOD PRACTICES ABOUT THE RESPONDENT

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1 EU MULTI-STAKEHOLDER FORUM ON ELECTRONIC INVOICING ACTIVITY GROUP 2: ECHANGE OF EPERIENCE AND GOOD PRACTICES ABOUT THE RESPONDENT Q1. Which country are you based in? Netherlands Q2. Which of the following would best describe the organisation you work for/represent? National Forum (response on behalf of the entire Forum) Bank or Banking Association Business / Employer Association Consumer / User Advocacy Group Consultant or academic researcher Department / Ministry / Government agency for Industry, Business or Enterprise Development, Technology or Innovation or Government standard-setting body Department / Ministry responsible for interior affairs, regulatory reform or public sector reform e-invoicing service or solution provider e-procurement / e-commerce / B2B solution provider Financial regulator Government purchasing / procurement authority Individual responding in private capacity Individual business (Large 250 or more employees) Individual business (craft or SME less than 250 employees) Professional body or private standard-setting body Tax or revenue authority, Treasury Department or Ministry of Finance What is the name of your organisation? National Multi Stakeholder Forum on E-invoicing ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 1

2 DEFINING GOOD PRACTICE Q3. Please consider the following definition of e-invoicing. Electronic invoices are defined as invoices that have been issued and received in electronic format. This includes structured e-invoices that are transmitted, processed and archived fully electronically from end to end throughout their life-cycle and unstructured e-invoices, for example in.pdf format. In any case, invoices must be tax-compliant. Do you consider this definition to be comprehensive? Please comment. When looking at the definition mentioned above one could take into account: 1. To what extent a definition is comprehensive (enough), depends on the goal(s) it is used for and the domain(s) it is intended for. As an invoice is one of the most important documents in business, it is connected to a vast number of domains: commercial, fiscal, trade law, technology, communication (adoption), B2B, B2C, B2G. And so on. It also differs in time in an organisation between the stages of e-invoicing adoption maturity. Also as the goal differs, the definition of an electronic invoice differs. This multitude and heterogeneity of uses and domains (including the respective stakeholders and interests per domain) leads to a multitude and heterogeneity of electronic invoices definitions.this probably makes it very difficult to come up with a singular comprehensive definition of an electronic invoice. Perhaps a framework, like the interoperability framework could be helpful. 2. When drilling down on the abovementioned definition, one could say that it is prone to be technology biased. For instance, apart from issuing and receiving invoices, there currently are other processes based on which invoice information is exchanged in electronic ways between actors. Examples are: self-billing and vendor managed inventory. Opmerking [JA1]: Remarks made by reviewers: a. When invoices are send cross-border the question raises: tax-compliant for which tax authority. Should this issue be addressed in the definition? b. In the process of ordering and billing several invoice-like documents may play a role: pro-forma invoices, invoices collecting transactions, invoices building on and referring to other documents. c. the concept of invoice should be defined!. d. It is important to make a difference between bills and invoices. An invoice is a piece of document which is used to acknowledge goods received or service rendered. That is not a bill. A bill is a notice for payment which is supposed to be preceded by an invoice in most cases. That s why there is a billing address, not an invoice address. 3. Furthermore the phrase format is a bit technologically biased. For instance a recent CEN CWA mentions envelopes and data. And, one could ask what the consequences would be if the format aspect is removed from the definition. From a slightly different angle: What is the bonus if the format definition (and therefore: discussion) is added? 4. The distinct phrases structured format and unstructured format are also technologically biased. It could be that these somewhat opposing phrases are mentioned because it is of their respective connotations, mostly created by its stakeholders. For instance it is propagated that the exchange of- structured invoice information reaps much more benefits than the exchange of invoices in socalled unstructured formats. However this connotation has yet to be proven in practice, specifically in the adoption level by SME s, for instance by using tools that enable structured data exchange against a low/zero investment. 5. Besides the point, though still interesting: invoice formats that are claimed to be unstructured, actually are structured. Though not in the particular sense that it suits the interests of this or that stakeholder. For instance almost every PDF document is a structured document; otherwise it could ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 2

3 never have been printed/generated. The same applies for MS Word, MS Excel and HTML invoices. In the meantime more and more tools and services are available that allow to convert a so-called unstructured, less efficient invoice into the (more) efficient structured data. (Some of the NL E- invoicing Forum members mentioned that conversion is sub-optimal and does not any value in an ideal situation where structured data can freely be exchanged between business partners) From that perspective, even so-called unstructured can pave the path to the benefits that are associated with the structured relatives. In the meantime many believe that ultimately invoices that can be made part of one s (financial) system without human intervention for instance by importing them-, will determine the way people perceive e-invoicing, eg will become the de facto definition. Using a technology neutral definition allows for innovative and creative developments that further the adoption of e-invoicing. 6. So the same questions could be asked: What are the negative consequences for massive adoption of e-invoicing when one leaves these particular phrases out of the definition? Or: What is the bonus for the massive adoption of e-invoicing with addition of the distinction between structured and unstructured formats. 7. As an alternative a more technology neutral definition could be: Electronic invoices are invoices that are electronically exchanged between business partners and that are stored electronically 8. A final thought is that we should take into account that the invoice cannot easily be singled out from its domain and therefore the process it is part of. For instance the (e)invoice could be part of the supply chain domain, the supply chain finance domain, a simple payments domain and so on. These domains dominate the processes surrounding the e-invoicing and can even have a profound impact on how the e-invoice is defined. In other words: the domain the invoice is part of dominates its connotation, its definition. So the invoice should be observed from within its environment; not as a singular object. Opmerking [JA2]: One of the reviewers would like to add processed to exchanged and stored electronically Q4. Please consider the following definition of good practice simply doing things that are shown to work or be effective and that conform to applicable commercial and legal governance? Do you have any comments on this definition of good practice in the context of promoting the use of e-invoicing? When looking at the definition mentioned above one could take into account: 1. The definition feels a bit static. What if there is a good example somewhere out there, that has never been made public? From that perspective a good practice can only become a good practice if ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 3

4 it is disseminated by making it public or by actively sharing it with a public. Also a good practice tends to become good practice only if the example can be reproduced by at least once. 2. One might ask why the phrase Simply doing things has been used. First of all, supporting the massive adoption of e-invoicing by disseminating for instance best practices has a lot to do with changing peoples behaviour. People have a natural tendency to not want to change their behaviour. So successfully changing behaviour is not something that one can achieve by simply doing things. And from looking at the current rate and ambitions on e-invoicing adoption, changing the e-invoicing requires a multi-year plan for instance the 8-step Kotter approach- and a little time to let demographics do its part. 3. Second, it sometimes seems as if that the ambition to massively promote the massive uptake of e- invoicing is primarily focused on the e-invoicing front office : to ensure a maximum invoice information exchange between business partners. However as an invoice is one of the most important documents in the economic arena, it is of vital importance that the adoption(level) is structural, durable. The adoption and use of e-invoicing, especially by SME s, should be facilitated in such manner that they never return to paper again. For instance because a liberal approach of electronic invoicing generates too much fraud. 4. Last: the words that are shown to work lack reference to a context. A good practice is often strongly intertwined with a context: a sector, size of an organization, a specific application, businessmodel or market. For example: Good practice using e-invoicing for optimizing internal administrative processes in an organization (administration, reporting, financial/fiscal) often will have different aspects then good practices in which e-invoices are used for the reduction of transactioncosts in networks of organizations closely work together to produce services or products. ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 4

5 E-INVOICING OPERATING MODELS SUPPORTED BY SERVICE PROVIDERS (INCLUDING BANKS) OR CONDUCTED DIRECTLY BETWEEN TRADING PARTIES Q5. On a scale of 1 (disagree completely) to 5 (agree completely), to what extent would you say you agree that the following models have contributed to the adoption of e-invoicing generally in your country? Please consider: Opmerking [F3]: Where 3 = neutral/indifferent - adoption in terms of the share of transactions conducted in this way and - the numbers of organisations adopting such methods. 5.1 B2B Buyer-driven supply chain model at national level, in which larger buyers recruit or mandate e-invoicing for suppliers as part of the accounts payable process, has contributed to the adoption of e-invoicing Don t know or N/A 1 Disagree completely Agree completely 5.1.a Not supported by a service provider 5.1.b Supported by a service provider 5.2 B2B Buyer-driven supply chain model at multi-country/cross-border level in which larger buyers recruit or mandate e-invoicing for suppliers as part of the accounts payable process, has contributed to the adoption of e- invoicing 5.2.a Not supported by a service provider 5.2.b Supported by a service provider 5.3 B2B Supplier driven model at either national or international level in which suppliers send or make available invoices as part of the accounts receivable process, has contributed to the adoption of e-invoicing 5.3.a Not supported by a service provider 5.3.b Supported by a service provider ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 5

6 5.4 B2B EDI model where multiple trading parties are interconnected either through a Value Added Network or a secure point to point link for the exchange of structured supply chain data/documents 5.4.a Not supported by a service provider 5.4.b Supported by a service provider 5.5 B2B Self-billing model where a larger buyer creates an e-invoice on behalf of the supplier and administers the process 5.5.a Not supported by a service provider 5.5.b Supported by a service provider 5.6 B2G public procurement model at national level where a public agency organizes a public procurement process (within a defined scope) and recruits or mandates adoption by suppliers, has contributed to the adoption of e- invoicing. 5.6.a Not supported by a service provider 5.6.b Supported by a service provider 5.7 B2G public procurement model at crossborder level where a public agency organizes a public procurement process ( within a defined scope) and recruits or mandates adoption by suppliers, has contributed to the adoption of e- invoicing. 5.7.a Not supported by a service provider 5.7.b Supported by a service provider 5.8 B2C e-billing model where larger billers send or make available e-invoices to consumers/sme s via portals, , Internet banking or by other means, has contributed to the adoption of e-invoicing. ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 6

7 5.8a Not supported by a service provider 5.8b Supported by a service provider 5.9 Bank or Payment Service Provider models: 5.9.a Marketplaces/Hubs where participants in an electronic market place or special purpose hub send/receive e-invoices as part of the service, has contributed to the adoption of e- invoicing. 5.9.b Integration of invoicing and ERP systems of businesses, has contributed to the adoption of e-invoicing.* 5.9.c Total invoice management model where a service provider processes all invoices in paper and in electronic form on behalf of a trading party (whether for suppliers or buyers) * 5.9 b Potentially Dutch ERP/financial systems could have made a major impact in e-invoicing model. However these service providers have a relatively old-fashioned vision and corresponding business model. There also the chicken and egg paradigm: they don t develop/communicate e-invoicing features until enough customers ask them to do so. And because the keep low, their customers don t ask them about it. And so on Q6. Please rate the importance of each of the following operating models to the wide adoption of e- invoicing, on a scale of 1-5 (where 1 = not at all important and 5 = extremely important). Don t know or N/A 1 Not at all important Extremely important 6.1 Buyers mandating e-invoicing or making it compulsory as part of a trading relationship Opt-in where trading parties are allowed to opt in on an operating model Opmerking [F4]: What is the focus: - Adoption to date? - Future adoption? - In the Netherland? - In the EU? This question was answered based on: - Adoption to date -in the Netherlands Opmerking [F5]: Where 3 = neutral / indifferent Opt-out models, where trading parties are allowed to out of an operating model 6.3 Inter-connection or interoperability between service providers. 6.4 Existence of an easy to use identification Opmerking [F6]: Based on the input from NL E-invoicing Forum members Opmerking [F7]: Based on the input from NL E-invoicing Forum members ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 7

8 and addressing system domestically 6.5 Existence of an easy to use identification and addressing system globally or at the EUlevel. Opmerking [F8]: Based on the input from NL E-invoicing Forum members 6.6 Creation of shared service centres 6.7 The availability of tools and techniques ( either as a package or as components) to provide compliant e-invoicing including electronic signatures, EDI, or other means, including support for business controls as provided for in the new VAT Directive ( 2010/45/EU) 6.8 The use of document images (e.g. PDFs)* 6.9 The parallel provision of PDF s where structured information is handled 6.10 The ability of business models to on-board large numbers of trading parties with ease and speed 6.11 Integration of the end-to-end procurement to pay process as opposed to a modular approach** 6.12 Cloud-based accessibility of e-invoicing platforms*** * 6.8 Research shows that (1) PDF is heavily used because of some killer apps like and free available PDF printers (2) There are more efficient ways of e-invoicing (3) PDF invoicing can act as a barrier in bringing e-invoicing adoption to the next level. The way this questions was filled out, reflects this vision ** 6.11 Somewhat similar to 6.8 with the way this question is filled out, we want to reflect that current day practice on end to end integration is low, whereas a higher adoption level of this approach can yield higher adoption rates *** 6.12 Accessibility is important. Especially accessibility to low/zero investment tools. *** 6.12 Cloud is a mere technical form and is less relevant related to wide adoption ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 8

9 Q7. Could you please name a few (no more than 3) initiatives or solutions that you believe represent good practice in promoting the wide adoption of electronic invoicing? You do not need to provide details at this stage, just the name of the service/product/initiative that you have in mind so that we can identify it for further research. - Sectoral initiatives: health, construction, transport, food, - Big buyers/sellers financially- enforcing e-invoicing - Government as launching customer, accepting and sending only structured electronic invoices per deadline. See example countries: ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 9

10 INITIATIVES TARGETED AT SMALL AND MEDIUM SIZED ENTERPRISES (SMES) Q8. On a scale of 1 (disagree completely) to 5 (agree completely), to what extent would you say you agree that the following models have contributed to the adoption of e-invoicing by SMEs in your country? Please consider adoption in terms of the share of transactions conducted in this way and the numbers of SMEs adopting such methods. Opmerking [F9]: Where 3 = neutral/ indifferent 8.1 B2b Buyer-driven supply chain model at national level, in which larger buyers recruit or mandate e-invoicing for suppliers as part of the accounts payable process (b=sme) Don t know or N/A 1 Disagree completely Agree completely 8.1.a Not supported by a service provider 0<data 8.1.b Supported by a service provider 0<data 8.2 B2b Buyer-driven supply chain model at multi-country/cross-border level in which larger buyers recruit or mandate e-invoicing for suppliers as part of the accounts payable process 8.2.a Not supported by a service provider 0<data 8.2.b Supported by a service provider 0<data 8.3 b2b Supplier driven model at either national or international level in which suppliers send or make available invoices as part of the accounts receivable process. 8.3.a Not supported by a service provider 8.3.b Supported by a service provider 8.4 B2b EDI model where multiple trading parties are interconnected either through a Value Added Network or a secure point to point link for the exchange of structured supply chain data/documents 8.4.a Not supported by a service provider ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 10

11 8.4.b Supported by a service provider 8.5 B2b Self-billing model where a buyer creates an e-invoice on behalf of the supplier and administers the process 8.5.a Not supported by a service provider 8.5.b Supported by a service provider 8.6 b2g public procurement model at national level where a public agency organizes a public procurement process ( within a defined scope) and recruits or mandates adoption by suppliers 0<data 0<data 8.6.a Not supported by a service provider 8.6.b Supported by a service provider 8.7 b2g public procurement model at crossborder level where a public agency organizes a public procurement process (within a defined scope) and recruits or mandates adoption by suppliers 8.7.a Not supported by a service provider 8.7.b Supported by a service provider 8.8 SME Peer to Peer (b2b) model, using either PDF or structured data 8.8.a Not supported by a service provider 8.8.b Supported by a service provider 8.9 B2C/b e-billing model where larger billers send or make available e-invoices to SMEs via portals, , Internet banking or by other means 8.9.a Not supported by a service provider 8.9.b Supported by a service provider 8.10 Bank or Payment Service Provider????? Opmerking [F10]: Potentially confusing/misleading. See also Q3. Opmerking [F11]: Peer to peer implicates the absence of a service provider ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 11

12 models: 8.10.a Marketplaces/Hubs where participants in an electronic market place or special purpose hub send/receive e-invoices as part of the service 0<data 8.10.b Integration of invoicing and ERP systems 8.10.c Total invoice management model where a service provider processes all invoices in paper and in electronic form on behalf of a trading party (whether for suppliers or buyers) 0<data Q9. Please rate the following measures in terms of operating models that have encouraged or demonstrated the potential to encourage e-invoicing adoption by SMEs? Opmerking [F12]: Where 3 = neutral / indifferent 9.1 Little or no in-house IT resource necessary Don t know or N/A 1 Not encouraging at all Very encouraging 9.2 A common national standard for invoice content 9.3 A common EU standard for invoice content 9.4 Publicly available platform provided by the government????? 9.5 Service provider solutions specifically aimed at SMEs Opmerking [F13]: Because the standards discussion ought to be a nonissue for SME s: SME s should be facilitated in standards, regardless whether one or several standards exist. Opmerking [F14]: Similar Opmerking [F15]: Depends on the definition of platform: proprietary versus interconnection/interoperability 9.6 Bank solutions specifically aimed at SMEs 9.7 Integration with SMEs accounting software 9.8 Peace of mind on VAT compliance ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 12

13 9.9 Affordability 9.10 Information and awareness campaigns targeting SMEs Opmerking [F16]: Based on the input from NL E-invoicing Forum members Q10. Could you please name a few (no more than 3) initiatives or solutions that you believe represent good practice in promoting the wide adoption of electronic invoicing by SMEs? You do not need to provide details at this stage, just the name of the service/product/initiative that you have in mind so that we can identify it for further research. - Online and mobile invoicing apps that allow for prompt payment - PDF printers (even though it is not the most efficient method of e-invoicing), that provide ML output - Low key PO flip tools - SME focussed consolidator platforms - General terms and conditions for e-invoicing - Guarantee/approval/warranty of a (part of a) service - Use and promotion of a standard, including the tools to use them (see Finvoice (Finland) and Nemhandel (Denmark)). - Issue, receive and process invoices via Internet Banking ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 13

14 THE ROLE OF GOVERNMENT AND THE PUBLIC SECTOR Q11. On a scale of 1 (disagree completely) to 5 (agree completely), to what extent do you agree with the following statements regarding the attitudes of the public sector and policymakers towards e- invoicing? Opmerking [F17]: Where 3 = neutral / indifferent 11.1 Good practices are the same whether it s private or public sector purchasing we re talking about Don t know or N/A 1 Disagree completely Agree completely 11.2 It is the public sector, rather than the private sector, that leads the e-invoicing agenda in this country 11.3 Policymakers in this country rely substantially on the expertise of service and solution providers when discussing e-invoicing x 11.4 My country has been a leader in Europe in setting up a policy framework/ public sector solution that encourages e-invoicing 11.5 Government has set an example by adopting e-invoicing widely in its own procurement 11.6 Government supports a single standard or a very small number of standards to the exclusion of all others Opmerking [F18]: Some of the NL E- invoicing Forum members made clear that a lot more national Governments should take up a leading role, like the Dutch Government did and currently does When it comes to the e-invoicing agenda; the initiative in this country is expected to usually come from the EU 11.8 Policymakers would rather support an inferior solution (either technically or as a business proposition) if it showed signs of becoming popular very quickly 11.9 Government has initiatives in place aiming to increase awareness of e-invoicing ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 14

15 among businesses Q12. Could you please name a few (no more than 3) initiatives or solutions that you believe represent good practice in promoting the wide adoption of electronic invoicing in public procurement or by government suppliers? You do not need to provide details at this stage, just the name of the service/product/initiative that you have in mind so that we can identify it for further research. 1. Government as launching customer 2. Creating an B2G infrastructure 3. Setting a standard (See also Q10 above) ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 15

16 SECTION G: DRIVING ADOPTION Q13. On a scale of 1 (disagree completely) to 5 (agree completely), to what extent would you say that each of the following arguments has been crucial to the adoption of e-invoicing in your country over the last 5 years? Opmerking [F19]: Where 3 = neutral / indifferent 13.1 Access to corporate supply chains in the private sector Don t know or N/A 1 Disagree completely Agree completely 13.2 Access to international markets 13.3 Access to finance* 13.4 Access to the public procurement market 13.5 Prompt payment 13.6 Environmental benefits / saving on paper etc Compliance with VAT rules and regulation** 13.8 Process efficiencies 13.8 Cost savings 13.9 Financial control and audibility * 13.3 A better access to finance could have helped with the adoption of e-invoicing. But because of the lack of access to finance, it did not do e-invoicing any good. **13.7 Formerly, strict regulations on compliance with VAT rules have acted as a barrier for adoption. But as soon as one was assured that it acted according to these regulations, this assurance could act as a driver in e-invoicing on-boarding towards business partners. Observations: the archiving aspect of e-invoicing is missing in this list. ACTIVITY GROUP 2: FINAL SURVEY QUESTIONNAIRE 16