Using Peppol for e-Invoicing in Japan
Japan has been using Peppol e-invoicing standards, which align with global interoperability practices, since October 1, 2023
By Ioana Ploesteanu, Product Marketing Manager, Tradeshift
Japan adopted the Peppol BIS Billing 3.0 standard under its Qualified Invoice System (QIS) on October 1, 2023.
This system, integrated with the Pan-European Public Procurement Online (Peppol) framework, allows businesses to exchange electronic invoices in a standardised format, ensuring compliance with consumption tax regulations.
The “JP PINT” format has become the designated standard for transactions within Japan, offering a seamless connection to the broader Peppol network.
Why did Japan decide to use Peppol for e-Invoicing?
The urgency for such digital frameworks for invoicing in Japan, like Peppol, was spotlighted during the pandemic, which exposed vulnerabilities in traditional paper-based systems.
Central to Japan’s transition is the updated Electronic Record Retention Law (ERRL), which mandates that electronic transaction records, including Peppol-compliant invoices, be digitally stored.
As of October 2023, e-invoicing has been successfully integrated into business-to-business (B2B) and business-to-government (B2G) transactions, supported by a standardised Peppol format tailored to Japan’s requirements, called JP PINT.
On June 1, 2024, Japan updated its invoicing standards to align with Peppol PINT BIS Billing version 1.0.2, aiming to boost compliance and streamline cross-border invoicing processes.
Notable updates include the JP BIS Invoice for Non-Tax Registered Businesses Version 1.0.1 and the JP BIS Self-Billing Invoice Version 1.0.1.
How well have businesses adapted to the use of Peppol for eInvoicing?
One year after Japan implemented Peppol-based e-invoicing, the transition is showing mixed but generally positive results.
The system is part of a larger push to digitalise Japan’s business practices and align with global standards, particularly for cross-border transactions.
The adoption of e-invoicing has significantly streamlined administrative processes, reducing the reliance on paper-based methods and enhancing transparency and tax compliance.
It has also enabled businesses to improve efficiency and securely archive transaction data digitally for the required ten years.
These changes are expected to drive productivity across sectors as more companies embrace automation.
However, challenges remain.
Some businesses, especially smaller ones, have struggled with the transition due to a lack of technical infrastructure or staff training.
The government and organisations like the Japan Digital Agency continue to promote the system, offering resources to support smoother adoption.
What are the benefits of using Peppol for e-Invoicing in Japan?
- Efficiency: Peppol’s interoperability eliminates the need for localized invoicing systems, enabling faster processing of cross-border transactions.
- Cost reduction: Businesses save on labour and materials by moving to digital formats.
- Environmental impact: Reduced paper usage aligns with Japan’s commitment to eco-friendly practices
How can businesses operating in Japan connect to Peppol?
Japanese companies have two options to connect to Peppol:
- Become your own Peppol Access Point: This involves setting up the necessary infrastructure and technical expertise to directly connect to the Peppol network. However, this can be a complex and time-consuming process, requiring significant investment in IT resources.
- Integrate with an existing Peppol Access Point: A Peppol Access Point (AP) acts as an intermediary, enabling businesses to connect to the Peppol network without needing direct integration. This is a more cost-effective option for many businesses as it eliminates the need for complex technical setups. Tradeshift is one such Peppol Access Point (AP) provider.
Tradeshift’s compliance coverage
Tradeshift has a proven process for delivering compliance-as-a-service, and provides customers such as AirFrance, Disneyland Paris, Schaeffler with innovative solutions that support their digital transformation journey and ensure they comply with e-invoicing and tax clearance mandates.
We currently offer compliance-as-a-service for 70 countries, including a streamlined process for complying with tax clearance mandates in 12 countries and e-Invoicing mandates.
Examples of countries with tax clearance or B2B e-invoicing mandates that we support are Malaysia, France, Romania, and Germany with other European and APAC countries such as Australia on our roadmap.
To ensure compliance excellence, we continually evaluate emerging global regulations and prioritise the inclusion of additional countries in our roadmap.
We’re also the only company offering cross-zone fapiao e-invoicing capabilities in China and among the first to become a registered PDP (PDP immatriculée) in France.
