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Estonia

Executive summary

Estonia is a little exceptional compared to other European countries - if in most countries the B2B e-invoicing is developed first, then in Estonia the development started with B2C e-invoicing.

B2C e-invoicing
The first B2C invoice in Estonia was sent in 2000. Today the percentage of fully digital e-invoices is approximately 22% - with this percentage Estonia is amongst the leading countries in Europe. The most common way to send an e-invoice/e-bill is via e-mail, into internet bank or into self-service portals of invoice sender. The amount of e-invoices is as high mostly thanks to a unique web portal for e-bill receivers - arved.ee.
Arved.ee is an independent register for ordering e-invoice, it neither depends on invoice issuer nor receiving mode. To change all your invoices into e-invoices you just have to join Arved.ee and after a few clicks you can choose either to receive your e-invoices into your internet bank or via e-mail. The system requires an ID-card or internet bank authentication and then you are free to choose the appropriate receiving mode.
This register is basically a "green list" - a list of persons wanting to receive e-invoices. Invoice issuers can use this "green list" as a tool during the invoice issuing process. They can look whether or not their client has registered him/herself as an invoice receiver in some channel. If the receiver has registered him/herself in such a channel then the invoice issuer can send the invoice to the receiver without prior consent. Arved.ee is a non-profit portal but with its functionality it is a one of a kind in Europe.

B2B invoicing
B2B e-invoicing is less developed in Estonia then B2C invoicing. The legislation is very flexible and there is no additional demands to e-invoices compared to paper invoices. General rules set in VAT directive are applicable for invoicing, authenticity and integrity are ensured “by other means”.
In the SME sector and also amongst some larger corporations the practice of sending and receiving invoices through e-mail has become common. A lot of invoices are still being sent on paper. The first workflow systems were adopted in Estonia by corporations in 2004-2005. Since 2008 the use of Workflow systems has become more popular.
Even though the transmission of purchase invoices is conducted through digitizing paper invoice, a lot of companies are looking for ways to receive e-invoices. Today there is a e-invoice service providers network developing in Estonia - banks, service providers and the public sector have agreed upon an infrastructure to exchange e-invoices. More and more invoices are being transmitted as so called "real" e-invoices from the senders information system to the receivers information system.
The e-invoicing service providers and the banks take care of the set-up, maintenance, monitoring and backups for the network connections. They also handle any format conversions needed for e-invoices, allowing customers to select the method of sending and receiving e-invoices that suits them best.
The main invoice standard format is “Estonian E-invoice XML” but this format is not found a wide range of use today. Some international standards and proprietary formats are also used.
The B2B sector is using arved.ee register as well as the B2C e-invoicing. Receiver-company registers itself in the portal and invoice issuer can use this information and send e-invoices without extra permission.
In the trade sector e-invoicing is developed already since 2001 – in those separated sectors is e-invoicing in better condition.