e-Invoicing in France: Chorus Pro adaptation to intermediate companies
The e-invoicing massification process in France kicked off last January with the Chorus Pro model. However, to date only 70,000 public entities and 214 large companies have adapted to this mandatory new system. From now on, the AIFE considers that over 1 million administration suppliers still have to migrate. Next up are 4700 medium-sized companies obliged to take the plunge by January 1, 2018.
Ordinance No 2014-697, which covers the e-invoice known as Facture Demat in France, has split the electronic adaptation process into four steps, depending on company size and turnover. Now, only companies with more than 5000 employees and earnings of over 2 million euros are obliged to use e-invoicing with the public sector. This is therefore only a minority part of the French market.
Nevertheless, from January 2018, implementation of e-invoicing in the private sector will start to become an exception. The regulation considers “intermediate” companies to be all those with 250 to 5000 employees and a billing turnover between 1.5 and 2 million.
Of course, the true fiscal dematerialization will take place between 2019 and 2020 when SMEs and micro-enterprises will have to adapt, respectively. By then, the French executive expects that roughly 95 million invoices will be issued electronically each year This should achieve savings of €710 million per annum.
How should medium-sized businesses adapt to Facture Demat?
In addition to setting out a schedule for adoption, the French regulation states which issuing system is most suitable for each type of company. In the case of medium-sized companies, the recommendation is to use an EDI solution with direct connectivity to the ChorusPortal (the Public Sector e-invoicing hub).
The main reason that medium-sized companies use EDI is that it lets you automate the process of creating, issuing, reporting and storing the documents. We must remember that in most cases this type of company generates more than 1000 invoices a year addressed to public agencies, so their creation and manual uploading to the Chorus Portal really slows down productivity.
With EDI, suppliers to the administration can integrate the e-invoicing solution with their ERP or habitual management system. This way, admin and management departments have no need to modify their internal working procedures.
Every time an invoice is created in the ERP, the solution transforms the document automatically into the UBL structured data format required by the regulation, which adds security to the transaction compared to manual uploading in PDF format. Later, the same solution communicates directly with the Chorus Portal. The entire process takes place in a matter of seconds in a way that is totally transparent to the user.
However, rolling out a solution of this kind calls for changes in the company’s systems. So, it is crucial to prepare the switch to e-invoicing with sufficient margin of time to meet the deadline demanded by law.
Taking advantage of dematerialization
Beyond the immediate benefits, such as fewer errors, increasing productivity or cutting economic costs, e-invoicing through EDI can mean other advantages for businesses in the mid-term.
In the sense, the Facture Demat solution created by EDICOM not only automates the issuing of e-invoicing in France, but is also a scalable platform. Through it, it is possible to file tax returns in over 60 countries worldwide, so that multinationals can centralize all these tasks in a single solution.