Status of Mandatory Electronic Invoicing Between Companies in Spain
On June 20, 2023, the publication of the Draft Royal Decree for implementing Law 18/2022, which focuses on electronic invoicing among businesses and professionals as part of company creation and growth, took place. This was followed by a designated period for public hearings and information submission, allowing for the presentation of allegations, which concluded on July 10. After these steps, the draft required submission to the Council of State and approval by the Council of Ministers before being published in the Official State Gazette.
Since that time, the draft has been undergoing standard processing, and it is anticipated that the final version of the technical regulation will be published in the Official State Gazette in the upcoming months.
The initiative to implement electronic invoicing between businesses in Spain is described within the "Crea y Crece" Law, which was created in September 2022. This law designates electronic invoicing as the exclusive method for conducting commercial transactions between companies and self-employed individuals in Spain. This measure aims to enhance payment efficiency and oversight, ultimately reducing commercial debts and promoting business expansion.
Who is Required to Issue Electronic Invoices?
Business owners and professionals engaged in business-to-business transactions are required to issue electronic invoices when the recipient is also a business owner or professional. However, this obligation does not apply under the following circumstances:
- If either party involved in the transaction does not have their primary economic activity headquarters within Spanish territory or lacks a permanent establishment in Spain to which the invoicing is directed.
- Simplified invoices issued in accordance with Article 4 of Royal Decree 1619/2012, except for qualified simplified invoices as defined in Article 7.2 of the regulation.
When is Electronic Invoicing Mandatory?
The Royal Decree will be enforceable twelve months after it is published in the Official State Gazette. Consequently, based on the draft presented, the implementation will follow these stages:
- One year for businesses with an annual turnover exceeding 8 million euros from the final publication of the Royal Decree.
- Two years for all other businesses (those with sales below 8 million euros) from the final publication of the Royal Decree.
During the initial 12-month period after the Royal Decree takes effect, companies that are mandated to issue electronic invoices in their transactions must provide a PDF document alongside them to ensure legibility for companies and professionals for whom the requirement to receive electronic invoices has not yet been enforced. This is unless the recipients of electronic invoices voluntarily and explicitly opt to receive them in their original format.
How will Electronic Invoicing work in Spain?
The Spanish B2B electronic invoicing system will comprise a series of private platforms for electronic invoice exchange that meet the criteria outlined in the Royal Decree, along with a public electronic invoicing solution functioning as an invoice repository, overseen by the State Tax Administration Agency (AEAT).
Electronic invoicing can be conducted using private platforms, the public solution, or a combination of both. Companies and professionals are mandated to issue and transmit electronic invoices to their trading partners while also receiving them from their suppliers through any of these channels. Irrespective of the channel through which the electronic invoice is delivered to the client, all electronic invoice issuers who don't utilize the public electronic invoicing solution are obligated to send an accurate duplicate of each invoice in the Facturae format to the public solution, encompassing the essential minimum requirements defined in the technical regulations of electronic invoicing.
How to Generate an Electronic Invoice?
To create electronic invoices, businesses must adhere to the technical specifications outlined in the Royal Decree that approves the regulations governing invoicing obligations. According to the draft regulation, electronic invoices can be generated using one of the following formats:
- XML CII format from CEFACT/UN, applicable to all invoices
- UBL format for invoices and credit notes, as defined in the ISO/IEC 19845:2015 standard.
- EDIFACT format for invoices in accordance with the ISO 9735 standard.
- Facturae format, in the version for invoicing between entrepreneurs and professionals that is in force at any given time.
The authenticity of the origin and the integrity of the content of electronic invoices must be ensured through one of the following methods:
- By utilizing an advanced electronic signature in compliance with the eIDAS Regulation governing electronic identification and trust services.
- Through electronic data interchange (EDI) when procedures are employed to guarantee the authenticity of the origin and the integrity of the data.
Statuses of Electronic Invoices
As stipulated in Article 2, paragraph 1 of Law 56/2007 dated December 28, recipients of electronic invoices must communicate the following statuses of invoices:
- Complete commercial acceptance or rejection of the invoice, including the date.
- Full payment of the invoice, along with the date.
Furthermore, it is possible to report the following statuses:
- Partial commercial acceptance or rejection of the invoice, and the corresponding date.
- Partial payment of the invoice, specifying the amount paid and its date.
- Assignment of the invoice to a third party for collection or payment, including the identification of the assignee and the assignment date.
Interconnection Among Private Electronic Invoicing Platforms
Providers of private electronic invoicing platforms are required to establish connections with any other private electronic invoicing provider that are part of the Spanish electronic invoicing system when requested by one of their clients.
Alternatively, if the client permits, providers can utilize the public electronic invoicing solution as a means of interconnection. In the event that the public solution is employed for this purpose, the private electronic invoicing platform chosen by the recipient will be responsible for adapting the electronic invoice message to meet the syntax and technical specifications agreed upon by the parties, should it differ from the format and specifications of the public electronic invoicing solution. This ensures the preservation of the authenticity of the message's origin and the integrity of its content.
EDICOM’s Global Electronic Invoicing Platform
EDICOM, a global leader in electronic invoicing, is the most widely used provider by Spanish companies for exchanging electronic invoices. Our platform is also one of the most preferred choices for Spanish companies and international businesses to manage electronic invoicing with Spanish public administrations. Furthermore, it supports other fiscal procedures such as Immediate Supply of Information (SII) and Ticket Bai (Basque Country).
EDICOM offers its customers a comprehensive solution that complies with all the technical requirements of the Spanish electronic invoicing system and those of any other country worldwide.