On 18 January 2018 last, Patrick O’Donovan TD, Minister of State with Responsibility for Public Procurement officially signed Ireland up as an Authority Member of OpenPEPPOL, the international association with responsibility for maintaining PEPPOL (Pan-European Public Procurement Online), a network operating in the sphere of e-procurement and e-invoicing.
This follows on from the launch late last year of the government’s plans to increase the use of digital technology, such as business information modelling (“BIM”), in key public works contracts. As part of these plans, public bodies will establish requirements for the use of BIM in the construction and operation of public infrastructure over the next four years. Both of these initiatives compliment the government’s ‘eGovernment Strategy 2017-2020’, published in July 2017, which sets out ten key actions for Ireland to become a leader in digital government services, including facilitating secure online identification, improving underlying infrastructure and providing appropriate skilling.
It is clear that the current government is seeking to emphasise and increase the use and importance of technology not only in the carrying out of public sector works but in engaging and managing the State’s relationships with contractors across all fields of procurement. Why is this, and why now? Specifically, what is the significance of PEPPOL membership, how do Irish businesses, and the State, benefit from it and what steps should you take if you are a supplier of goods or services to the public sector?
Ireland’s decision to become a member of PEPPOL stems directly from Directive 2014/55/EU (the “eInvoicing Directive”). The eInvoicing Directive obliges all public sector bodies to be able to receive e-invoices by April 2019. In order to ensure compliance with the eInvoicing Directive, the government has set up eInvoicing Ireland, operating out of the Office of Government Procurement which will work to co-ordinate Ireland’s approach to implementing e-invoicing and make all stakeholders aware of impending obligations. Joining PEPPOL is part of the OPG’s plan to ensure compliance with the eInvoicing Directive but also demonstrates the State’s commitment to using innovative technological solutions in the public sector.
PEPPOL itself is not an e-procurement platform. Rather, it is an e-delivery network, a set of harmonised technical specifications to be used in existing e-procurement platforms (or business exchange services more broadly). Rather than making all states use the same system, PEPPOL allows each state to maintain its own system but ensures all systems work, and interpret data (such as supplier information, invoice amount, etc.), in the same manner. Implementation of PEPPOL facilitates cross-border service provision, collaboration and efficiency through ‘interoperability’ – it removes the hindrances often encountered in the procurement of services cross-border by ensuring that barriers such as language, different information requirements, specific document formats are removed. Think of the technology as akin to mobile phone technology – once a phone is connected to a network you can call a phone on another network as the different network operators have allowed them to connect with each other.
The impact of PEPPOL is two-fold: firstly, it will increase efficiency, transparency and competition in the Irish public sector by allowing documents such as orders and invoices, to be submitted electronically, thereby increasing cost savings for all and ensuring fairness; secondly, it will give Irish suppliers access to all European public sector buyers using the PEPPOL network, increasing opportunities for Irish businesses by opening up public markets which would otherwise be unavailable or inopportune due to the types of barriers discussed above. Also, Ireland, as an Authority Member, will be able to participate in the development of, and shape, the future use and operation of PEPPOL.
The use of e-invoicing is not mandatory in Ireland yet, and so any businesses currently supplying goods or services to public bodies can continue to conduct their operations in the same manner as before. However, mandatory e-invoicing exists in many other countries (for example, it has been mandatory for Danish suppliers to send e-invoices through the national e-invoicing platform, NemHandel, since 2005 and the use of PEPPOL specifically has been mandatory in Norway since 2012) and the government has indicated its intention to make e-invoicing mandatory for Irish public bodies soon. Nonetheless, as it stands PEPPOL presents an opportunity to Irish business to get ahead of the e-government game; by becoming “PEPPOL-compliant”, a business stands to gain an advantage over non-compliant competitors in transacting with public authorities, ensure readiness once mandatory e-invoicing is introduced in Ireland and also gain access to a European-wide network of public organisations seeking goods/services at no additional financial or time-related cost. Suppliers can become PEPPOL-compliant by connecting with an “access point” which will send and receive documents to the buyer’s access point.1
Taken in the context of the eGovernment Strategy 2017-2020, it is clear that initiatives such as BIM and PEPPOL are merely the first steps in Ireland’s path towards becoming a country in which the administrative organs of the State use technology to its fullest capability to facilitate efficiency, modernity and cost-effectiveness to the benefit of government, business, and, ultimately, all taxpayers. Ireland is irrefutably one of the top destinations for multinational technology corporations and has a growing reputation as a hub of indigenous digital entrepreneurship. The eGovernment Strategy, and membership of PEPPOL, demonstrates the intention of the State to reflect and adopt private sector innovations and priorities in the carrying out of public functions. Whilst prior to now, government action has focused on supporting the development of the private technology sector, membership of PEPPOL represents a concrete commitment to using this technology within the arms of government itself. Full implementation of the eGovernment Strategy will allow Ireland to become a world leader in digital government.