In this article, we will address the following questions:

1. What are the most significant characteristics of digital billing?

2. Which are the principal Spanish laws governing the implementation of digital billing?

3. According to legislation, what are the main requirements for digital billing?

First of all, we want to point out that there are many synonyms for digital billing: digital invoicing, electronic billing, electronic invoicing, e-billing, e-invoicing, telematic billing, telematic invoicing, etc.

Since 2003, digital invoices have been able to replace paper invoices in Spain. This is possible thanks to digital signatures, a tool which guarantees the integrity and authenticity of the signed document and, as such, ensures a very high degree of security, lending full legal validity to the digital message.

The Most Significant Characteristics of the Digital Billing System

In order to make an invoice legally valid, it is essential that it be digitally signed. A digital signature shouldn't be interpreted as a handwritten signature, as it is never imperative in any instance that the invoices bear a handwritten signature.

It isn't necessary to be authorized by the Tax Agency or to sign a contract. The necessity for obtaining approval of software and notifications has also been eliminated. The result is flexible system without excessive bureaucratic red tape.

Any means of transmission is acceptable and as such, we can send invoices through a Value Added Network, over the Internet or in an e-mail message. The only condition is that they be digitally signed, as this guarantees the security of the information, ensuring that it hasn't been modified (integrity) and confirming the identity of the sender (authenticity).

In any event, the recipient's consent is necessary in order to work with digital billing. However, there is no need to notify or obtain authorization from the Tax Agency.

It is very important to point out that a digitally signed electronic invoice - or digital invoice - completely replaces a paper invoice; as such, a digital invoice is subject to the same requirements and obligations as paper invoices. This means that the message "EDI-Invoice" takes the place of an original paper invoice and can be presented to an auditor just the same as if it were on paper.

The Principal Spanish Laws Governing the Digital Billing Process

We must first point out the regulations related to billing using digital signatures, Ministerial Mandate number HAC/3134/2002 of December 5th, published in the Federal Registry on December 13th, 2002.

This Ministerial Mandate is complemented by the Resolution of the General Director of the State Tax Administration Agency, which details the approved procedures for generating digital invoices and the approved methods of signing them (Resolution number 2/2003 of February 14th, entered in the Federal Registry on February 17th).

Since then, digitally signed invoices have enjoyed full legal validity, as well as the ability to replace paper invoices completely. It is also fitting to mention the publication of Royal Decree number 1496/2003 on Billing of November 28th, which complements the measures described in both the Ministerial Mandate and the Tax Agency Resolution.

The Principal Spanish Legislative Requirements for Digital Billing

Contents of the invoice: Obviously, the message "EDI-Invoice" must contain ALL of the information that it would have to include if it were a paper invoice. For example, in order to work with e-invoices, it will be necessary to include the Tax ID number, legal business name and physical address in the EDI message, among other information. Previously, this information could be omitted in the EDI message, as it lacked legal validity in any event.

Storage of the digital invoice: One of the main advantages of the new system is the elimination of the obligation to file paper invoices. With the e-invoice, the "EDI-Invoice" message and the digital signature must be maintained along with the digital certificate, which allows for verification of the sender. Furthermore, this digital filing can be done from anywhere, as long as access to the invoices can be guaranteed upon request by the Administration. This means that whenever an auditor comes to our offices, we must guarantee his access to the invoice archives; however, it is no longer necessary to submit the paper copies, due to the fact that the "EDI-Invoice" files are equally valid.

Digital signatures: It is possible to use any commonly-accepted digital signature system and the signature can be included in any manner, as long as both parties (the sender and recipient) have full knowledge of it.

Certificates: The certificate authorities and the allowable digital certificates are both published in the Tax Agency's webpage (aeat.es). In general, any recognized certificate is permissible for the purpose of signing invoices.

Thanks to digital invoices software, companies can reduce the costs associated with paperwork (stuffing envelopes, stamps, paper and opening envelopes), as well as the expense of filing them. Additionally, the worrisome possibility of misplacing or losing them is completely eliminated.

Furthermore, the new legislation regulates billing departments and third-party billing,in the case of those who act on behalf of the entrepreneur or professional that performed services or provided goods subject to billing (Law number 53/2002 on Fiscal, Administrative and Social Order Measures, published in the Federal Registry on December 31st of 2002).

Among other products, Pixelware has created diverse Business Solutions for the Electronic Management of documents, which facilitate compliance with the regulations governing digital invoices.