E-invoicing enables suppliers and buyers to exchange accurate, structured data automatically, without all the manual steps that slow things down. It can boost efficiency, reduce errors, and support more sustainable operations.
Crucially, liability for compliance often extends to non-resident organisations, meaning companies can be affected even if they are not headquartered in, or physically operating from, a country that enforces e-invoicing mandates. As a result, multinational businesses must navigate obligations that follow them across borders and as many organisations have discovered, implementing a global e-invoicing strategy can be incredibly challenging.
The multijurisdiction compliance labyrinth
While there are efforts towards regulatory harmonisation, like the Peppol framework, which is used by businesses in Europe as well as Singapore, Japan, and the EU’s ViDA, the reality is that businesses must be prepared to operate within a fractured ecosystem of national mandates1. This fragmentation is tricky, as it is not just technical standards that must be addressed, but governing philosophies too. The global e-invoicing landscape remains split mainly between several modalities.
The three modalities: CTC, Post audit and hybrid e-invoicing models
- Clearance-based Continuous Transaction Control (CTC) regimes pioneered in Latin America require businesses to route invoices through tax authority platforms in real time for approval. Essentially, the government acts as an intermediary to “clear” each invoice in order to prevent tax fraud and evasion.
- Post-audit or interoperability models (e.g. the EU’s Peppol 4-corner network) allow invoices to flow directly from supplier to buyer, and they are audited by tax authorities at a later time. These models ensure that organisations can exchange procurement documents securely regardless of their internal software by adhering to a common “language.”
- Emerging “hybrid models” (Peppol-CTC / 5 Corner) are the most complex new trend. Jurisdictions, like the UAE or as proposed under the EU’s ViDA initiative, are fusing the two previous models. This is the most severe architectural challenge for multinational organisations. For example, businesses must have architecture that enables them to support both the federated Peppol network for invoice delivery and the real-time reporting of CTC for fiscal compliance.
Each model creates very different data flows, and most multinationals will end up operating in several of them at once. And because legacy systems, especially large, monolithic enterprise resource planning systems (ERPs), weren’t designed for this level of variation, many companies are forced to bolt on country-specific middleware solutions, creating a patchwork that becomes harder to maintain, scale, or govern as mandates grow.
While global organisations need the stability of a central ERP to anchor their Order-to-Cash (O2C) and Procure-to-Pay (P2P) processes, every new integration increases complexity. Without a clear architectural strategy, these short-term fixes may resolve immediate compliance issues but undermine long-term scalability, agility, and control.
E-invoicing mandates are now forcing business technology leaders to rethink their core processes and data governance, especially how customer and transaction data move from CRM to ERP systems. Although the data is already there, it must now be captured, structured, and shared in ways that meet evolving compliance and reporting rules. This shift also requires closer coordination between Tax, IT, and Legal teams to balance tax authority demands with privacy obligations. As a result, the challenge is not only about compliance or technology but also broader operational and process transformation.
E-invoicing compliance: The non-resident supplier (NRS) burden
Companies that are issuing invoices into a foreign jurisdiction where they do not have a physical presence are also liable to comply with the new e-invoicing compliance regulations. The traditional “permanent establishment” model for indirect tax will not be applicable in the coming years, as tax authorities attempt to close the “VAT gap.” Governments are imposing VAT registration, collection, and e-invoicing obligations on non-resident suppliers (NRS) based on the customer’s location, not the supplier’s physical location2. This means that a company selling digital services globally must now register for VAT in dozens of jurisdictions where it has no legal entity, staff, or physical office.
Cross-border trade in physical goods is also impacted. Let’s imagine a UK manufacturer exports industrial components to Poland. Before the goods can even clear customs, the company must now register for Polish VAT and issue compliant e-invoices through the KSeF system3. A single schema or validation error can delay shipment release, strand goods at the border, disrupt fulfilment, and potentially damage customer relationships.
Failing to integrate with a jurisdiction’s mandated platform can prevent invoices from being issued or accepted, effectively blocking revenue. What was once a local administrative requirement has evolved into a market-access capability that determines whether a company can quickly enter and trade in new territories compliantly.
The regulatory catch-22: Tax-authority vs. data privacy
Another major challenge that multinationals must confront is conflicting regulatory requirements for both granular invoice data and strict data privacy. Real-time invoice reporting gives tax authorities unprecedented visibility into transactions, which is great for reducing fraud and closing the VAT gap; however, it can directly conflict with privacy laws like the EU’s GDPR, which call for data privacy and data purpose limitation. A salient example emerged in Italy; the Italian Data Protection Authority (Garante) found the system collected far more personal data than necessary for tax purposes Full invoice details included sensitive personal information, including descriptions of medical or legal services that could reveal a person’s identity.
Multinational corporations need to be wary. Non-compliance with tax e-invoicing mandates isn’t a viable option, but neither is violating privacy laws by sharing too much data. Some countries have stricter data privacy laws than others, so it is important these companies are keenly aware of what invoice data is being transmitted and ensure there’s a legal basis for each data element while also aligning with tax compliance obligations5.
Navigating the intersection of tax and privacy certainly presents a technical problem, but it is also an organisational issue. It is imperative that multinational organisations establish new governance structures that bring together tax, legal, and IT to manage these risks collectively and effectively.
The introduction of CTCs blurs departmental boundaries. For example, IT might build an application programming interface (API) to transmit e-invoice data, but they can’t simply switch it on. Legal must check that the data being sent doesn’t violate privacy laws, and Tax must ensure it meets the specific requirements of the jurisdiction. So, in this new era of digital tax enforcement, an organisational shift towards integrated governance models is necessary in addition to new technological requirements.
Your 5-step strategic action plan
- Map your exposure: Catalogue where you operate, where you sell without a local presence, and which models apply (CTC, Peppol/post-audit, hybrid). That becomes your risk and priority matrix.
- Separate core from edge: Keep O2C/P2P in the ERP, but design an integration/compliance layer to handle country specifics so you stop adding one-off middleware.
- Embed continuous compliance operations: Create a small cross-functional team (Tax, Finance, IT) to monitor mandate changes, test updates, and push them out globally.
- Tighten data and privacy governance: For every jurisdiction, define what data is sent, under what legal basis, and who signs off (Tax vs Legal vs IT).
- Embed ownership locally: Train the people who actually issue invoices and maintain customer/supplier data so rejections and customs delays don’t creep back in.
If organisations complete five actions, e-invoicing regulations will stop being treated like a rolling fire drill, and they’ll have a repeatable, scalable way to enter markets, protect revenue, and stay on the right side of both tax and data privacy authorities. Ultimately, the companies that succeed will be those that treat e-invoicing as a core enterprise capability rather than a series of isolated country projects.
Ready to transform your e-invoicing into a core enterprise capability? Contact us today to future-proof your compliance.
Disclaimer:
This article is based on current regulatory announcements, including the EU's ViDA implementation strategy, national government publications, and global industry analysis as of October 2025. Regulations continue to evolve; strategic advice should be tailored to your organisation’s specific context and jurisdictions of operation.
This article is provided for general information purposes only and does not constitute legal advice. The content in this article is not a substitute for professional advice. You should seek independent legal advice to obtain a full analysis of the relevant legislation and its application to your particular circumstances.
References
1. European Commission. “VAT in the Digital Age (ViDA).” Taxation and Customs Union, European Commission, 4 Nov. 2024, https://taxation-customs.ec.europa.eu/taxation/vat/vat-digital-age-vida_en.
2. “Adoption of the VAT in the Digital Age Package.” Taxation and Customs Union, European Commission, 11 Mar. 2025, https://taxation-customs.ec.europa.eu/news/adoption-vat-digital-age-package-2025-03-11_en
3. Ministry of Finance, Republic of Poland. “National e-Invoicing System (KSeF) — Mandatory Rollout from 2026.” Ministerstwo Finansów via EDICOM, 4 July 2025, https://edicomgroup.com/blog/poland-will-make-b2b-electronic-invoicing-mandatory
4. “E-Invoicing in Italy.” European Commission – Digital Building Blocks, 22 Aug. 2025, https://ec.europa.eu/digital-building-blocks/sites/spaces/DIGITAL/pages/467108890/eInvoicing%2Bin%2BItaly.
5. European Data Protection Supervisor. Opinion 7/2023 on the Legislative Proposal ‘VAT in the Digital Age’, 3 Mar. 2023, https://www.edps.europa.eu/system/files/2023-03/23-03-03_opinion_legislative_proposal_digital_age_en_5.pdf
