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Peppol is a cross-border network for e-procurement. Its goal is to provide a faster, completely digital public authorities’ tender and procurement process using open standards at low cost.
Read on to find out all about Peppol, from the history of the network to continuous transaction control (CTC).
A simple, cross-border e-procurement network, Peppol combines a range of components and specifications such as a central user directory and standards for e-invoicing and e-ordering. Furthermore, the OpenPEPPOL organisation governs the how Peppol is used through a multilateral network of contracts. It is important to know that Peppol is an open, cross-border network and not a platform. Once connected, those in the Peppol network can use that one connection to exchange digital procurement documents with any other user. Peppol covers not only e-invoicing, but also the entire tender and procurement process (e-procurement). Naturally, it also supports directive 2014/55/EU on electronic invoicing in public procurement.
A major factor in Peppol’s success is the interoperability of the various e-procurement systems and processes between members, as well as a simple on-boarding process for suppliers and customers. The enormous potential of Peppol and its obvious advantages have even reached Asia, Latin America and North America. However, how did Peppol begin?
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Peppol was developed by the OpenPEPPOL Association. The PEPPOL project began in 2008, financed as a pilot project by the European Commission as well as by members of the PEPPOL Consortium. Its goal was to simplify cross-border electronic procurement. To this end, all the European governments developed technical standards that could be implemented across their borders to enable direct electronic communication between companies and European government agencies for procurement purposes.
This is how the acronym ʽPEPPOLʼ, which stands for Pan-European Public Procurement On-Line, came into being. At the end of 2019, this acronym was replaced by the brand name ʽPeppolʼ, which now stands for global e-procurement. This rechristening to ʽPeppolʼ removes the limitations of ʽPan-Europeanʼ and ʽPublic Procurementʼ within the acronym, allowing Peppol to better reflect the ways in which it is actually used these days. Of course, due to its history of e-procurement and e-invoicing with public authorities, Peppol, is still widely used in B2G circles. However, while there are currently 30 European countries that are either involved in or actively using Peppol, there are many others further afield, including Singapore, Canada, Australia, New Zealand and the USA. Further Asian countries, such as Malaysia, are waiting in the wings. Although Peppol was actually originally developed to simplify procurement in the B2G arena, these days a number of countries also - or even exclusively - use it for B2B.
In Peppol, different message types (e.g. orders, invoices) are exchanged over open protocols. The following rules ensure interoperability:
Essentially, the parties in the Peppol network communicate over a 4-corner model. The sender and recipient stand at opposite ends of the outer edge, while the corresponding access points are the two inner corners. The sender sends a document, such as an electronic invoice, to his Peppol access point. From here, the network sends the document to his counterpart’s access point, where his counterpart can collect it. If his counterpart wishes to send a document in response, he sends this to his own access point, and the network forwards it to the recipient’s access point, from where it can be pulled into the recipient’s internal invoicing system.
The Peppol network assigns dynamic addresses to the receiving access points. Using the receiver’s Peppol ID , a request is made to the Service Metadata Locator (SML) for the address details of the receiver’s Service Metadata Provider (SMP). The SMP responds with the formats supported by the receiver and the address of the receiving access point. If the files to be sent are in a formats supported by the recipient, the process is started to send these to the receiving access point.
All organisations registered to Peppol, whether as a supplier, a business client, a government contractor, a service provider or - in the near future - tax authorities, can enjoy the following advantages:
What are the main advantages of Peppol for suppliers and customers?
From a supplier’s perspective, Peppol’s advantages can be summarised as follows:
Clients are most enthusiastic about the following advantages:
Peppol is based on four main pillars. These are:
The first pillar, the Peppol Transport Infrastructure Agreements – TIA,defines the general terms of cooperation and defines responsibilities for all parties. The TIAs are coordinated by the not-for-profit OpenPEPPOL AISBL, with the various Peppol Authorities also playing an important role.
The second pillar, the Peppol eDelivery Network, establishes common business processes and technical standards. The network uses a shared format, as well as a common digital signature technology to secure message content. This ensures a secure, interaoperable network of access-point providers.
The third pillar, thePeppol eDelivery Network Specifications sets the technical specifications and resources required for access to the Peppol eDelivery network and to implement its various components.
The fourth pillar, the Peppol Business Interoperability Specifications, ʽBIS’,standardises electronic documents. These standards enable secure, open data exchange, whether between purchasers in the public sector and their European suppliers, or purchasers and suppliers in other sectors or further afield. These e-procurement specifications, updated by OpenPEPPOL, build on the work of the CEN Workshop on Business Interoperability Interfaces for Public Procurement in Europe (CEN BII).
The national Peppol Authorities work with the Brussels-based openPEPPOL AISBL Coordinating Authority and form the national links of the network. They liase with the Access Point (AP) providers and the Service Metadata Providers (SMP) in their region. Their responsibilities include:
Users wishing to receive documents need to register to the Peppol network. However, no registration is necessary for sending documents.
Registering to receive data over the Peppol network involves entering your recipient details into your service provider’s Service Metadata Publisher (SMP). This is done either by the service provider or through a dedicated user interface for updating details.
As well as your Peppol ID, this includes your process and document IDs, essentially, the processes and document types you use. These IDs have been defined by Peppol and can be found here at https://docs.peppol.eu/edelivery/codelists/ in the Document Types list.
SEEBURGER is both an Access Point service provider as well as an SMP. Users can update their details held by the SMP through a dedicated user interface.
Details on each recipient (such as Peppol ID, processes and documents supported) can be published as a business card in the Peppol Directory, to be viewed by the other participants. This directory can be found at https://directory.peppol.eu/public.
However, what exactly is a Peppol ID? How is it put together and what does it do in the Peppol network?
A Peppol ID plays a central role in helping you find the correct partner in the Peppol network. It is a unique reference number for each participant, used both at a technical level and in business documents. How this identifier is put together has been defined in the Peppol eDelivery Network Specifications.
The reference number consists of a pre-existing identifier, such as a VAT code, or another country-specific code such as thr Organisasjonsnummer in Norway. Therefore, you don’t need to specifically apply for a Peppol ID.
The ID formats currently in use can be found at https://docs.peppol.eu/edelivery/codelists/ under ʽParticipant Identifier Schemeʼ. For Germany, one component of the identifier may be the participant’s VAT code. Therefore, an example Peppol-ID could be 9930:DE1743082945.
The relationship between a Peppol ID, a Leitweg-ID, a VAT code and a GLN (Global Location Number)
A Leitweg-ID is German reference number following a specific format that was developed as part of XRechnung. It is used in business transactions with the German public sector such as federal government, federal states, municipalities and local authorities. The Leitweg-ID is recognised by Peppol as a valid component of its Participant Identifier for use in its transport network. For corporate German entities, Peppol recognises a VAT code or a GLN. Contractors from the private sector can therefore use their VAT ID/ as their unique Peppol Participant Identifier to enable them to send or receive documents. Contractors from the public sector use their Leitweg-ID.
A Leitweg-ID, GLN or VAT code is turned into a Peppol ID by adding a 4-number prefix.
Government agencies use their Leitweg-ID e.g. 9958: 05 7 11 333 – 12345 12345 - 57
Corporate entities use their VAT ID, e.g. 9930: 12346789
In 2020, OpenPeppol moved even closer to launching international invoicing. This is expected to give a boost to the standard-based interoperability of business processes across the globe. This is a complex project requiring OpenPeppol to devote extensive technical and business resources to its success.
A new trend in digitalisation is awakening the interest of every tax authority around the globe. It is a trend that affects electronic invoicing, but is not confined to this area. We are talking about automated transaction systems, which can generate data needed by a government to collect tax and for purposes of corporate efficiency. Peppol is considered to be one of the solutions in this area, indeed, the solution that optimally combines business efficiency in the economy with tax reporting and/or accounting models. CTC could be an excellent avenue for Peppol to approach governments from another direction. Equally, it could be pose a threat if developments in the market end up bypassing Peppol.
Fully digital exchange of any transaction documents via interop: - Australia - Finland - Singapore - Switzerland
Variations: (1) domestic framework and (2) Peppol framework
Transactions in public procurement exchanged with a predefined infrastructure: - EU Member States - Singapore
Variations: single infrastructure (1) with Peppol and (2) without Peppol
Submission of transactional data in near-time after issuance: - Hungary - South Korea - Taiwan - Greece (possibly)
Variations: (1) supplier only and (2) both supplier and buyer
Approval of transactions pre-issuance and validation post-receipt: - Chile - Mexico - Turkey - Italy
Variations: (1) hard / soft clearance & (2) outsourced / inhouse clearance
Figure 5: Continuous Transaction Controls CTC
The results of the CTC PoC project will be vital for determining OpenPeppol’s business strategy in this area in 2021.
In order to enable CTCs in the Peppol network, we first need to integrate the various domestic tax authorities into the data exchange - at least for the tax relevant content. The preferred approach at present is an outsourced clearance process.
The Peppol service providers act on behalf of the local tax administrations and send batches of tax-relevant Peppol BIS documents to the domestic tax authorities.
The central tax platform - the fifth corner – is the governmental data analysis vault. This captures tax-pertinent details from invoices AND other documents such as orders, shipping confirmations, delivery notes and payment instructions.
There is currently a feasibility study in progress on whether pre-existing clearing and reporting models can also be offered as a further option.
Integrating the tax authorities into the invoicing processes in the Peppol network is an important step in empowering Peppol for the growing CTC trend. However, we don’t only have our eye on CTCs. We want to harmonise the Asian and European semantic data models to create an international data model, the Peppol International Invoicing Model (PINT).
In order to improve interoperability between international partners in the network, in 2018 we started a project with the goal of defining an international invoice model. The aim is to enable an international exchange of electronic invoices with public authorities all over the world while also ensuring that specific local stipulations on e-invoicing are supported.
The main task in creating an international model consisted of developing a common core to increase interoperability while, where possible, supporting specific stipulations.
Source: 25.03.2020-Cross-Community-Webinar-Presentations.pdf (peppol.eu), P. 16
The result is the semantic data model ʽPeppol International Invoicing Model (PINT)ʼ, with common semantic definitions for users of the model.
The design principle behind PINT was based as closely as possible on the established ʽPeppol BIS Billing 3.0ʼ, and therefore also on directive EN16931. Wherever necessary, PINT extends the semantic definitions of the business terms in the data model, or adds further business conditions to enable requirements not foreseen by the core European invoice model and EN 16931. As PINT is an extension to Peppol BIS-Billing 3.0, BIS-Billing 3.0 is compatible with PINT. Specifications for electronic invoices in other countries and regions also need to be compatible with PINT.
Source: Peppol International Invoice model review - PINT - Peppol International Invoicing Work Group - Confluence (atlassian.net), P. 4
SEEBURGER was certified as one of the first German Peppol Access Point Certified Providers in 2019 by the OpenPEPPOL AISBL. SEEBURGER is a certified Peppol Access Point Provider for AS2 and AS4.
SEEBURGER offers a variety of protocols through which customers can connect to Peppol, including AS2, HTTPS, OFTP, SLMP and SFTP. You can find the technical connection data for the SEEBURGER Cloud in our data sheets and certificates.
Together, Peppol and PINT will form the largest common denominator for global e-invoicing for B2B and B2G transactions in the future. The networks assist in meeting the regulatory requirements for international e-billing in a growing number of countries around the world. The Peppol 5-corner model (5C), currently under review, may be piloted in France with the B2B Clearance e-invoicing directive coming in 2023. Peppol is therefore one of the most forward-looking solutions on the market for international e-invoicing.
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OpenPeppol Cross- Community Plenary session
peppol.eu › wp-content › uploads › 2020/10 › 2020.10...
Oct 20, 2020 — Peppol Continuous Transaction Control project – CTC (Paul Killie) d. ... architecture and specifications for a Peppol CTC model and run a PoC.
OpenPeppol Cross- Community online plenary
peppol.eu › wp-content › uploads › 2020/03 › 25.03.2...
Mar 25, 2020 — 4. The Peppol Continuous Transaction Control (CTC) project ... Conduct a Proof of Concept (PoC) testing on one (or more) scenarios
2020.06.16 GA12 slides_presented - Peppol
peppol.eu › wp-content › uploads › 2020/06 › 2020.06...
Jun 16, 2020 — For 2020. OpenPeppol will execute a CTC Proof of Concept (PoC) project which will extract the business requirements of Tax Authorities, develop ...