The French government has recently announced new eInvoicing requirements to help tackle evasion of the value added tax (VAT). Starting in 2023, new eInvoicing and eReporting obligations will apply to business-to-government (B2G) and business-to-business (B2B) transactions, including cross-border B2B and domestic business-to-consumer (B2C) transactions.
Across Europe, eInvoicing mandates are evolving rapidly. And it’s all driven by one objective: reducing the VAT gap, estimated at over €164 billion in 2020. A “generalization of eInvoicing” is set to commence from the beginning of 2023, and France is no exception.
That date may seem some time off—especially given the challenging circumstances currently facing businesses—but organizations that trade in France or with French companies should start preparing now. These new regulations, when enforced, will introduce sweeping changes.
French B2B and B2C transaction regulations are coming
The French government mandate builds upon the Europe-wide B2G requirement to extend eInvoicing and eReporting into the B2B and B2C sectors. According to French government proposals, eInvoicing will be mandatory on January 1, 2023, at the earliest, but no later than January 1, 2025. It stipulates that France will:
- Introduce mandatory eInvoicing via eInvoicing service providers for domestic B2B transactions; and
- Introduce a mandatory eReporting obligation on cross-border B2B and domestic B2C transactions.
While final details are pending, it’s clear the French government favors a technical model where invoices can transit directly between certified private platforms without using the public platform, so that the system can support multiple billing formats. In addition, every eInvoicing obligation must also be accompanied by an eReporting obligation to achieve a wide set of data and obtain more information essential for the identification of the VAT owed.
As is often the case with new regulations, it’s highly likely that the eInvoicing mandate will require new commercial and tax information that is not currently collected. This will put pressure on companies and their vendors to redesign their invoices in response. Famously, the Indian government required no fewer than 40 new mandatory data fields when implementing its B2B regulations.
Simplify eInvoicing obligations in a rapidly changing world
The French mandate is just another example of the rapid uptake of eInvoicing within many countries and regions around the world. Complying with global eInvoicing regulations is an increasingly complex process, as the outcome in India demonstrates. Organizations of all sizes will find it difficult navigate the changing global regulatory environment for eInvoicing without deploying an enterprise eInvoicing compliance solution.
OpenText™ Active Invoices with Compliance (AIC) is a cloud-based electronic invoicing compliance solution that ensures you’re constantly up to date with all the B2B, B2G and B2C regulations in over 45 countries worldwide. It is also a certified PEPPOL Access Point available in any participating country, both across Europe and worldwide.
You can learn more about eInvoicing solutions from OpenText here or by downloading our ebook, eInvoicing Explained. You’ll also find more details in our latest Executive Brief, “French government makes eInvoicing and eReporting mandatory starting in 2023”.