Electronic Invoicing

Electronic Invoicing in the United States: Interoperable Exchange Network

 Electronic Invoicing USA

The Business Payments Coalition along with the Federal Reserve is piloting a standardized B2B electronic document exchange system in the United States. The initiative seeks to establish a standardized e-invoice model and create an electronic document exchange network, very similar to the PEPPOL system developed in Europe.

 

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Joint Declaration: Electronic invoicing interoperability between the United States and the European Union

The sixth ministerial meeting of the Council for Trade and Technology ("TTC") addresses the challenges of global trade with the aim of strengthening economic and commercial ties, accelerating the transition to climate-neutral economies, and promoting economic security. One of the significant objectives involves both reducing transaction costs and promoting collaboration opportunities to open doors to a multitude of applications in areas such as trade, customs and border procedures, payments, and fraud mitigation. 

In order to improve interoperability and seek harmonization of electronic invoicing, the United States and the EU intend to continue cooperating and coordinating to achieve greater compatibility, particularly in terms of business and technical interoperability. Both the United States and the EU have adopted the following key principles for the success of electronic invoicing, which are:

  • One connection, global access.
  • No charges for switching between access points (AP).
  • Open exchanges allowing users to freely select their access point.

The ongoing discussion will address several critical aspects, including:

  • Flexibility in data structure: While certain elements of the data structure require standardization, there should be flexibility to accommodate varying business information and adhere to local, regional, and national legal requirements.
  • Alignment of information exchanged: Ensuring compatibility of exchanged data in electronic invoices from both business and technical perspectives is crucial. This alignment facilitates smoother handling of invoices and other electronic documents, allowing interoperability and automation.
  • Roaming capabilities: Creating roaming capabilities through service providers is essential to address practical connectivity and accessibility. This step is crucial to achieving interoperability between the United States and the EU.

Digital Business Networks Alliance (DBNAlliance)

The BPC E-invoice Exchange Market Pilot participants have launched the Digital Business Networks Alliance (DBNAlliance) as the legal entity to oversee the new electronic exchange network.

As the oversight entity, the DBNA will be responsible for defining policies, standards, security mechanisms, and other rules and guidelines that make up the exchange framework. The DBNA will also offer membership to service provider access points and will assist them with connecting to the exchange framework.

EDICOM’s membership to the DBNA will allow us to act as an access point for any buyers and sellers intending to use the exchange framework. Businesses do not need to become a member of the Digital Business Networks Alliance – they only need a service provider that is a member to send and receive e-invoices on their behalf. Businesses simply need to connect once through their service provider access point to exchange e-invoices in a standard format with all other businesses connected to the exchange framework. Specialists take an active part in the DNBAlliance supporting the e-Invoicing project and acting as an Access Point to help companies in their transition to electronic invoicing. 

The Exchange Framework

This exchange framework is an electronic delivery network based on a set of technical standards and policies to allow businesses to securely share electronic supply chain documents with one another. It was developed to solve difficult issues businesses face when exchanging invoices between different platforms and systems, such as how to connect to other businesses, what information to send, and how to deliver it electronically. As a solution to these challenges, the exchange framework outlines a set of standards to securely exchange electronic invoices (e-invoices) between businesses – even when each business uses different software.

As the oversight entity, the DBNAlliance is tasked with governing the exchange framework and supporting the digital delivery of e-invoices in a manner that allows customers of all service providers to communicate with customers of all other service providers. 

Establishing this exchange framework to support all payment types is a significant step for the B2B payments ecosystem,” said Guy Berg, vice president, payments improvement, Federal Reserve Financial Services. “Launching DBNAlliance and the exchange framework confirms that now is the time to address B2B payment inefficiencies and realize the benefits of modernized electronic payments.”

Businesses whose service providers are members of DBNAlliance will find the network works within their current operating models with minimal or no system change requirements. Further, the exchange framework supports all electronic payment methods, including ACH, wire, card, and instant payments.

e-Invoicing model used in the Exchange Framework

The Exchange Framework is based on the exchange of electronic invoices through a Four-Corner Network Model, in which electronic documents are sent and received through Access Points that connect network users. All companies are senders and receivers. Once connected companies can exchange with all others registered in the network. 

The communication protocols will be AS2/AS4. The process will support requests and document status responses.

The format will be based on the existing OASIS UBL 2.X format for invoice and credit note documents. The structured file will be able to include attachments and will include an electronic signature. The fields that will be included are:

  • Supplier and customer information
  • Shipping information
  • Payment instructions, bank/card information
  • Document and item-level charges, discounts, and taxes
  • Item descriptions
  • Notes section

US e-Invoicing Pilot Project

The Business Payments Coalition along with the Federal Reserve is piloting a standardized B2B electronic document exchange system in the United States. The initiative seeks to establish a standardized e-invoice model and create an electronic document exchange network, very similar to the PEPPOL system developed in Europe. The US network will facilitate electronic commerce by enabling the efficient exchange of documents and straight-through processing for all sectors. More than 80 organizations participated in the pilot, which had three waves:

  1. Wave one (April 1 to June 30, 2022), focused on testing initial technical specifications for exchanging e-invoices.
  2. Wave two (July 1 to September 30, 2022), focused on further refine specifications and onboarding steps for businesses.
  3. Wave three (October 1 to December 31, 2022) finalized specifications for production. 

The pilot phase has concluded, and the network is now ready to begin the production phase. EDICOM, as a global technology provider of e-Invoicing solutions, participated in the pilot as well as in the workgroups organized for the development and testing of the system. 

 

Benefits of electronic invoicing

In a global market companies must seek opportunities by becoming more competitive, which sometimes means taking a technological leap that improves both the organization and the quality of the information handled, optimizing internal processes and people management.

Digitalization involves automating those processes that guarantee time reduction, error reduction, and cost savings derived from the greater efficiency of the entire purchasing and payment management process. These improvements undoubtedly contribute to the optimization of the supply chain, providing transparency and efficiency for the total integration of communications.

Features of EDICOM’s Global e-Invoicing solution

Integrated SaaS Platform with your ERP: Our integrated EDI solutions operate in SaaS mode, implemented on a technological architecture in a private cloud developed and managed by EDICOM, which implements all the applications and management resources required to ensure the uninterrupted exchange of all your EDI transactions. The platform establishes links with your ERP, CRM, and all management applications involved in electronic data exchange with your partners.

Multi-standard and multi-protocol: The global platform has multi-standard (EDIFACT, X12, UBL, PEPPOL, ODETTE...) and multi-protocol (AS2, AS4, OFTP, X400, SFTP...) functionalities, guaranteeing connectivity with any partner worldwide.

Fiscal control: EDICOM has international certifications as a trust service provider to provide electronic transactions with the required security measures. Electronic signatures, timestamps, or tax control codes and specific identifiers must be considered to provide documents with tax value. 

Scalable solution: The platform always adapts to the needs of companies, expanding projects according to the requirements of each region.

Communication with partners without the capacity to send or receive electronic invoices. For this, you should have a platform that includes specific functionalities such as web portals that allow your customers and suppliers to communicate with each other, even if they do not have an EDI solution.

Electronic archiving: (EDICOM Long Term Archiving) is the certified long-term electronic storage solution offered by EDICOM as a Qualified Trusted Service Provider. The service applies identification, digital signatures, and electronic chronological validation mechanisms in compliance with the eIDAS Regulation, thus guaranteeing the integrity and authenticity of the files stored over time.

Centralized management: Working centrally from a single global ERP for the entire company requires a single e-invoicing solution capable of issuing invoices in compliance with the requirements of each country in which the company operates.

Would you like to know more about e-Invoicing around the world?

Visit our Global e-Invoicing Map and ask us any question you may have.

Global e-Invoicing Map

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