Chorus Pro: How to prepare for e-invoicing and CTC in France

France started introducing mandatory B2G e-invoicing for suppliers to government entities in 2017. The French government chose Chorus Pro as the official and obligatory platform for businesses to issue e-invoices to public administrations. Since January 2020, all suppliers to the public sector (B2G) have been required to issue invoices electronically.

Now that B2G (business-to-government) e-invoicing is underway in France, the country has set its course on a countrywide e- invoicing and e-reporting mandate.

According to an announcement from the Council of Ministers, e-invoicing will become mandatory for all companies subject to VAT in France starting in 2024. Domestic B2B e-invoicing will become mandatory for large businesses in 2024, with medium and small businesses following in 2025 and 2026 respectively.

Changes will be introduced according to the following timeline:

From 2024: All France-based businesses will be required to be able to receive e-invoices. Large businesses will be required to both receive and issue e-invoices.

From 2025: Medium France-based businesses will be required to receive and issue e-invoices.

From 2026: Small and micro businesses based in France will be required to receive and issue e-invoices.

Timelines for implementation of other document types and e- reporting schemes are still pending clarifications from the DGFIP (the General Directorate of Public Finance).

All taxable persons, whether subject to VAT or not, will have to electronically issue and receive or otherwise report the following documents:

All documents issued electronically must also be archived electronically. The mandatory retention period in France is 10 years.

Not only will taxpayers have to issue, exchange and process the above documents electronically, but they will also have to report them in real time. The chosen method for e-reporting is also known as continuous transaction controls, or CTC. This can be done in one of two ways:

Option 1: Issue an e-invoice to Chorus Pro and they will do the rest (delivery to buyer and reporting to DGFIP).

Option 2: Issue an invoice through a PDP (Plateformes de dématérialisation partenaires), and PDP will do the rest: distribute the e-invoice to the buyer through the PPF (Portail public de facturation) or the buyer’s PDP, then report it to Chorus Pro.

Regarding cross-border invoices, there will be two different actions: receive or send the invoice in an unregulated format and then report the transaction to Chorus Pro in the regulated e-invoice format. Some PDPs cover both actions, but this is something to be agreed upon between the taxpayer and the PDP (not regulated).

According to the planned framework, only structured formats will be considered valid e-invoices for fiscal purposes. The DGFIP plans to regulate the use of a number of formats via the PPF and PDPs, as long as they are compatible with the European Norm.

Among the permitted formats are UBL 2.1, UN/CEFACT CII and Factur-X. Initially, only these three formats will be allowed but other formats such as Peppol BIS may be permitted in the future.

This means that by 2026, paper and simple PDF invoices will no longer be valid in France.

When registering a business in France, suppliers obtain specific identification numbers from the French tax authorities. These tax ID numbers can be broken down in the following way:

SIREN number (Fr. Système d’identification du répertoire des entreprises): A nine-digit business ID number issued by the French Institute of Statistics and Economic Studies, or INSEE. The SIREN number authorizes a company to issue invoices and operate in the market. It is given only once and is valid until the death or activity cessation of a natural person or liquidation and dissolution of a legal person.

SIRET number (Fr. Système d’Identification du Répertoire des Établissements) is a 14-digit establishment identification number allocated by INSEE. The first nine digits correspond to a company’s SIREN number and are followed by an additional five digits that indicate an internal classification number, or NIC (Fr. Numéro Interne de Classement). These five digits indicate the geographic location of the company’s headquarters and other possible establishments. Each establishment of the company gets a separate SIRET number.

All businesses possessing a SIREN number fall under the scope of the upcoming e-invoicing mandate in France.

Even though all details of the new infrastructure are not yet finalized, the French regulator foresees several mechanisms for businesses to fulfil the e-invoicing and transaction reporting obligations.

Existing: E-invoicing via Chorus Pro, the national portal (PPF)

The taxpayer will most likely be able to utilize existing connectivity with Chorus Pro, either directly or via a service provider, to exchange full invoices with trading partners connected to the governmental platform. In this case, both e-invoicing and e-reporting will be fulfilled simultaneously.

New: E-invoicing via certified private platforms (PDPs)

The taxpayer will be able to contract services a of PDP that will handle not only issuance, exchange (interoperability) and receipt of e-invoices but also handle the real-time reporting obligation. In this scenario, only the VAT-related subset of the e-invoice will be reported to the PPF. The complete e-invoice will be exchanged between trading parties in the agreed format.

New: E-reporting via Chorus Pro, the national platform (PPF)

Some types of transactions, such as import invoices and B2C receipts, will be possible to report separately from the transaction and not in real time. More clarifications are expected on this from the DGFIP.

The sooner you implement digital processes into your daily operations, the more prepared your business will be to start e-invoicing via Chorus Pro, PDPs or the PPF. You will need to ensure you are ready for e-invoicing, but where to start?

The receipt of e-invoices will be the first regulation to enter into force for businesses of all sizes. Even though not all details of the requirements are set, it is important to start preparing your organization for the upcoming digital transformation project. We recommend implementing an AP Automation solution that can help digitalize and streamline your supplier invoice handling, regardless of what systems you currently use.

Similarly, an AR Automation solution can help you prepare for the mandate by digitalizing the distribution of customer invoices.

With established operations and teams in France, Pagero is compliant with the current requirements for e-invoice issuance, exchange, and receipt as well as e-archiving and e-signature. We also aim to obtain the status of certified private platform, pending publication of the final regulations by the DGFIP.

This text was originally published 11 May 2021 and last updated 26 April 2022.