05.02.23

B2B e-invoicing discussion paper

The e-invoicing trajectory in Germany is gaining pace, in line with its neighbouring European counterparts on the continent. Last month, we commented on Germany’s intention to produce a discussion paper which would incorporate further details in respect of the proposed B2B e-invoicing mandate in the country. The process of producing the discussion paper has now concluded and, while the discussion paper is not yet publicly available, we do now have some indications regarding its content.  

The first striking element within the paper is the proposed timeline of Germany’s e-invoicing mandate- which is touted for 1 January 2025- a year sooner than expected, indicating Germany’s intention to expedite e-invoicing in the country. Other elements are perhaps less surprising- especially those which align Germany’s proposed e-invoicing model with the VAT in the Digital Age (ViDA) proposal.  

Exact details around the e-invoicing model are as of yet unknown, but it does appear that service providers can act on behalf of buyers and suppliers, with invoices processed via a central government platform. The model also confirms to ViDA standards, by undertaking plausibility and syntax checks on the invoice data, rather than ‘conventional’ clearance, which does not appear to contravene the spirit of the proposal.  

Moreover, in line with the ViDA proposal, the structured format is expected to align with the European common standard- the EN16931. Presently, the German solution does not comment explicitly on e-reporting- and so for now we do not expect this to be implemented in tandem with the e-invoicing component of the solution.  

 By means of a reminder, the German government requested a derogation to mandate e-invoicing in the country in November 2022- one month before the European Commission published the ViDA proposal. It is important to note that derogation has not been granted to mandate e-invoicing in the country. However, the proposed e-invoicing model- which for all intents and purposes seems to have been dictated largely by the ViDA framework- seems to suggest that at least on a surface level, little resistance would be provided to this effect.

As the e-invoicing model is envisaged before all the ViDA obligations come into effect (I.e. 1 January 2028), it looks likely that Germany will continue to strive for the derogation. Given that the derogation process is projected to become redundant from 1 January 2024, the European Commission’s response to Germany’s derogation request will be an intriguing one. 

Germany has already commenced the process of public consultation with business stakeholders, specifically, select larger German enterprises requesting detailed information around the e-invoicing process, no doubt to sharpen and refine its current plans for e-invoicing implementation.  

 Germany is a critical market for Tungsten Network. We are closely monitoring further details the German government confirms in respect of the proposed B2B e-invoicing mandate with a view as to how we can best serve our German market.