German plans to simplify e-invoicing as from 1 July 2011

The proposal states: “The requirement of authenticity and the integrity of the content will remain as abstract conditions for the sales tax approval of electronic invoices, but the other requirements for electronic invoices will be abandoned. So, there will be no technical requirements anymore that need to be meet by a German company. “As with paper invoices, the recipient must verify the authenticity and integrity of the content. As a best practice the discussion draft, mentions the qualified digital signature and the EDIFACT process also. The amendment is to take into effect on 1, July 2011.

Until then, § 14 of the Sales Tax Act prescribes that an electronically submitted invoices requires at least a qualified digital signature, so that the receiver can claim the VAT at the tax office. This scheme is based on an EU directive of 2006. The new directive provides for full equality between paper and electronic invoices and must be implemented by 2013 by Member States.

TeleTrusT eV, the association of German IT security companies, approved to the change in legislation. It stated: “The Federal Ministry of Finance puts the emphasis clearly on the qualified signature and secure EDI traffic. The procedure proposed by the EU’s new third way of ‘internal controls and process descriptions’ does not matter.” The VER (Association of electronic bill) was positive about equality of the electronic statements. However it also identifies risks as to, “no specific requirements for control procedures have yet been defined”. Furthermore the VER asked the question “what procedures are safe from a legal point of view.” The legislature should develop appropriate guidelines. In addition, the association pointed out that companies could avoid “technically complicated control mechanisms” when using an electronic signature.

Written by Friso de Jong


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