Regulatory updates - EU

The European standards organization (CEN) has approved updates to the EN 16931-1 semantic standard to align with upcoming legislative changes, including the VAT in the Digital Age (ViDA).

Background

CEN TC 434 was established in 2014 to create a common standard for electronic invoicing. The European standard is composed of six parts, including the semantic data model EN 16931-1:2017. The European Standard establishes a semantic data model of the core elements of an electronic invoice. The semantic model includes only the essential information elements that an electronic invoice needs to ensure legal (including fiscal) compliance and to enable interoperability for cross-border, cross sector and for domestic trade.

Challenges

The original EN 16931 development was driven by European Directive 2014/55/EU, which mandated e-invoicing for business-to-government (B2G) transactions. As a result, the standard lacked provisions for Continuous Transaction Controls (CTC) and comprehensive Business-to-Business (B2B) applications - gaps that would create challenges when ViDA becomes effective.

Changes

The European standards organization (CEN) approved the revision of EN 16931-1 semantic standard to align with upcoming legislative changes, including ViDA. 

This reform includes the following changes:

• New core semantic data model for B2B transactions
• Syntax bindings for CII and UBL, with new rules on mandatory and optional fields
• Extension methodology (CIUS and extensions) including industry-specific

Timelines

Updates to EN 16931-1 reform can be expected according to the timelines below:

• 23 October 2025: Date of ratification (dor) date when the Technical Board notes the approval of an EN (and HD for CENELEC), from which time the standard may be said to be approved
• 26 November 2026: Date of availability (dav) date when the definitive text in the official language versions of an approved CEN/CENELEC publication is distributed by the Central Secretariat
• 28 February 2026: Date of announcement (doa) latest date by which the existence of an EN (and HD for CENELEC), a TS or a CWA has to be announced at national level
• 31 May 2026: Date of publication (dop) latest date by which an EN has to be implemented at national level by publication of an identical national standard or by endorsement
• 31 May 2026: Date of withdrawal (dow) latest date by which national standards conflicting with an EN (and HD for CENELEC) have to be withdrawn

More information will be shared once the updated EN 16931 is published.

Between 2015 and 2016, the European Union (EU) established agreements with Andorra, Liechtenstein, Monaco, and San Marino. These agreements enable the reciprocal automatic exchange of financial account information between tax authorities in accordance with the latest EU Directive on Administrative Cooperation (DAC) and the OECD's Common Reporting Standard.

On October 13, 2025, the Commission enhanced its tax cooperation frameworks with Andorra, Liechtenstein, Monaco, and San Marino by signing amended protocols. These neighboring countries maintain significant economic ties with EU member states, making effective anti-tax fraud measures essential for ensuring a level playing field.

The recent amendments to the protocols demonstrate the EU's ongoing commitment to transparency and international cooperation. By updating these agreements to align with revised EU and OECD standards, the European Union is working to improve tax compliance and ensure fair competition globally.

A similar amending protocol with Switzerland is expected soon. Once ratified, all four protocols are anticipated to enter into force on 1 January 2026, reinforcing the EU's leadership in ensuring fair and transparent tax practices globally.

More details can be found in the European Commission's daily news.

On September 24, 2025, the European Commission announced the implementation strategy for the VAT in the Digital Age (ViDA) package.

The ViDA package consists of three legislative acts and aims to modernize the EU’s VAT system, address challenges in the platform economy, and make VAT compliance more resilient to fraud.

The implementation strategy provides a roadmap with key milestones and action points, aiming to enhance transparency in digital transactions and simplify cross-border VAT compliance. Alongside other updates, the implementation strategy specifically addresses digital reporting requirements (DRR), platform economy measures, and single VAT registration (SVR).

• Digital reporting requirements (DRR)

Real-time e-invoicing will become the default for cross-border B2B transactions, replacing periodic VAT summary reports. This is expected to reduce VAT fraud and lower compliance costs for businesses.

• Platform economy

Platforms in sectors such as passenger transport and short-term accommodation will be responsible for collecting and remitting VAT when users fail to meet VAT obligations.

• Single VAT registration (SVR)

The One Stop Shop (OSS) model will be extended, reducing the need for multiple VAT registrations across Member States.

Implementation

The Commission will work closely with Member States and businesses to ensure coordinated implementation.

Actions include promoting mutual recognition of certifications for e-invoicing software and supporting the use of a common transmission network among Member States to ensure interoperability.

The Commission will also provide technical guidance, communication campaigns, and regular progress monitoring.