Peppol invoicing uses software connected to the Peppol network to transfer invoices with companies digitally. E-invoicing is safer, faster, and cheaper than traditional invoicing. As such, some Scandinavian countries have made Peppol e-invoicing mandatory in the public sector.
Scandinavian countries are the most developed countries in Europe when it comes to e-invoicing. The first countries to adopt e-invoicing (in no particular order) were Sweden, Finland, Denmark, and Norway. These countries have incorporated e-invoicing within business-to-business (B2B), business-to-government (B2G), and government-to-business transactions (G2B).
In this article, you’ll find out what is Peppol e-invoicing and how you can connect to the Peppol network. We’ll also discuss mandatory e-invoicing requirements, whom they apply to, and the format used to send e-invoices in Scandinavian countries.
Let’s dive in!
What is Peppol e-invoicing?
In order to exchange e-invoices on the Peppol network you have to connect to a Peppol access point. You can then send and receive e-invoices from governments, contractors, and suppliers.
Peppol e-invoicing also allows you to safely exchange other business documents like:
- Catalog goods;
- Shipping data;
- Electronic orders;
- Invoice responses;
- Order confirmations;
Businesses that connect with Peppol can transfer documents in specified formats through this safe international network. Therefore, exchanging business documents on PEPPOL makes the process safe and secure and allows you to share invoices internationally with your business partners.
What are the advantages of using Peppol e-invoicing?
Peppol invoicing continues to grow due to its ease and cost-effectiveness.
Many businesses across Europe, Asia, and Australia have adopted e-invoicing due to its many benefits, such as:
- It’s quicker as it only takes a couple of seconds compared to transporting paper invoices which take days or weeks.
- It’s mandatory for most Asian and European transactions. You can check if your partner is on the Peppol network with this directory.
- Peppol e-invoicing is safer than using mail invoices in PDF format. There is a lower chance of scams or fraud.
- Using Peppol is cheaper than using mailing services to send invoices.
- Peppol offers a unique ID that reduces the chance of mistakes, such as paying criminals or ghost invoices.
- You can automate the e-invoicing, which means less workload for your team. Additionally, Peppol automatically updates itself to follow European and Asian e-invoicing formats.
What is a Peppol ID?
You can recognize an organization with a Peppol ID which makes using Peppol e-invoicing safe.
A Peppol ID will contain the following information:
- An organization's bank account number
- VAT number
- Chamber of Commerce number
- Government agency's ID number
The ID has unique numbers that give you information about the sender or recipient of invoices or other documents.
How to connect to the Peppol Network
You need a Peppol Access Point to connect you to the network. An access point is an organization that can grant you a Peppol ID to access the international e-invoicing network.
The process of connecting businesses to the Peppol network is the same as how phone companies connect their users to the telephone network.
The Peppol ID takes 24 hours to be validated. After validation, you can send invoices to international governments and companies or other Peppol users.
Peppol e-invoicing involves four parties:
- Access points of both sender and recipient;
- The sender;
- The recipient;
Storecove is here to connect you to the Peppol Network. You can then comply with the European e-invoicing regulations and send e-invoices to government agencies across the globe.
Let’s explore the Scandinavian e-invoicing guidelines.
Norway e-invoice requirements
Norway was among the first European countries to make e-invoicing mandatory for Business-to-Government transactions.
In 2011, central government administrations needed to receive e-invoices in a standard format. Then it became compulsory for public entities to ask their suppliers to send invoices electronically on 1st July 2012. According to Peppol Business Interoperability Specifications (BIS), the public providers had to receive e-invoices in EHF format.
In 2016, it became mandatory for public administrators and their suppliers to automate procurement processes and exchange invoices electronically.
Suppliers and public administrations can choose their access points. However, there are two requirements for them to receive or send invoices on the network:
- They should process invoices in the national standard format (EHF Billing 3.0).
- All public administrators must register with ELMA.
ELMA is a national Peppol Service Metadata Publisher (SMP). Access points use ELMA to verify the participant's identity and locate other access points. With ELMA, access points can also confirm the data or documents a user can receive or send through the Peppol infrastructure.
Private organizations are not required to use Peppol e-invoicing, but many Norwegian companies are adopting the Peppol network. The private companies can access ELMA to confirm which organizations in Norway can get e-documents in EHF format via the Peppol network.
In Norway, you can send or receive the following electronic documents:
- Credit note;
- Payment reminder.
E-invoicing in Denmark
Denmark is the pioneer in using e-invoicing. Since 2005, suppliers of services and goods have been required to use Peppol invoicing while dealing with public institutions and public authorities.
Since 18th April 2019, all the state public authorities can receive electronic invoices through Peppol e-Delivery Network.
Public administrations must receive E-invoices according to the OIOUBL format via the NemHandel platform and the Peppol network. NemHandel is the precursor platform of Denmark before the Peppol network. However, the government is pushing towards the use of Peppol because of all its benefits.
The Danish Business Authority (ERST) acts as Peppol Authority. ERST allows Danish companies to register as Service Metadata Publishers or Access Points.
ERST is also involved in the following duties:
- Securing and reporting the national interest of Denmark;
- Assuring the quality of operator's services;
- Ensuring the use of Peppol network to establish long-term adoption of e-procurement;
- Combining interests in the electronic business sector with various agencies.
Denmark's long-term goals of Peppol include:
- Encourage electronic trade across the border for both private and public organizations;
- Enhance utilization of e-invoicing in the public sector;
- Encourage B2B electronic invoicing;
- Authorize the using E-catalogues and E-orders in a public establishment.
The public administration is the largest user of e-invoicing in Sweden. In early 2008, the Swedish government made issuing e-invoices to state agencies mandatory.
On 1st April 2019, the government extended the requirement of Peppol e-invoicing to the municipal and regional pubic providers and administrations.
What are the e-invoicing requirements in Sweden?
E-invoicing in Sweden mandates the following guidelines:
- Public administrators must send e-invoices in Peppol BIS Billing 3.0 format.
- Public administrations should receive e-invoices through the Peppol network.
- Government agencies should send and receive e-invoices via the Peppol network to other public providers.
- Public administrations and their contractors or suppliers can exchange catalogs and electronic orders via the Peppol network.
- If public administrations and suppliers do not comply with e-invoicing requirements, they will receive fines from the DIGG, the Agency for Digital Government.
- Private organizations can exchange e-invoices through Peppol voluntarily.
E-invoicing in Finland
E-invoicing is widespread in Finland, even though they didn't have mandatory policies until February 2019. However, the Finnish had to follow the basic e-invoicing requirements of the European Union. Since 2010, the public administration has preferred receiving e-invoices via Peppol.
In February 2019, the Finland parliament made it mandatory for public administrations to exclusively receive e-invoices following European standards. The central government bodies had until 1st April 2019 to comply with the regulations. On the other hand, other public procurement entities were given until 1st April 2020.
On 1st April 2020, the Finnish e-Invoicing Act 241/2019 was implemented. This law stated the following:
- B2B invoices had to comply with the EN 16931 and Finnish e-invoicing standards.
- Organizations can refuse e-invoices that do not follow the EN guidelines.
- Older formats like Finvoice and TEAPPSXML are still in use due to the Corona pandemic.
Solution to Peppol e-invoicing in Scandinavia
The Peppol adoption has increased significantly throughout Scandinavia. Countries like Sweden, Norway and Denmark made it mandatory for public administrations to receive e-invoices through Peppol. This is because Peppol is a quicker and safer method ompared to traditional invoicing.
Do you wish to utilize this safe transaction method? This e-invoicing solution can help your business connect to the Peppol network. After validation, you can immediately send and receive e-invoices to organizations and government agencies worldwide.
This e-invoicing solution will also help you to:
- Automatically comply with European and Asian e-invoicing guidelines;
- Adhere to the local tax authorities;
- Save a lot of money with automatic processing.
More information about e-invoicing in Scandinavia?