Policy Context and Legal Framework

The NemHandel project operates within the context of European (particularly i2010) and national policy as well as within a strategic framework for a comprehensive digitisation of Danish society through the establishing of state-of-the-art shared infrastructure.

EU policy aligned

The underlying principles and objectives of the NemHandel project are completely aligned with the objectives of the EU i2010 Strategy in that NemHandel is used as a central instrument to promote an open and competitive digital economy, promote open standards and ensure interoperability. Also in line with the i2010 objectives the design and development of NemHandel is based on actual business requirements gathered through an open dialoque with stakeholders with particular attention to SME needs. As encouraged by the i2010 Strategy, NemHandel uses digital signature to create a secure and reliable services which increases trust and actual use. Equally in line with the i2010 objectives NemHandel seeks to deliver better public service and to pave the way for more services and wider use of ICT.

National policy

Since 2005 Danish suppliers to the public sector have been required by law to send invoices electronically. This affects approximately 70% of all Danish businesses. Thus, existing legislation allows electronic invoicing in the public sector to act as a key driver for the NemHandel initiative, which is targeted more widely to help businesses digitise their business processes.

Using legislation as a driver positively affects both the end-users, i.e. businesses, the ICT market, i.e. IT vendors and services providers, and the public sector institutions:

IT vendors benefit from a clear message from government as to the direction digitisation is meant to take. Legislation on mandatory use of specific standards within the public sector has already had a very positive impact on smaller IT solutions providers (software or online services), who previously did not have the capacity to compete in a electronic invoicing solutions market characterised by disparate and competing standards.

In terms of business policy the NemHandel initiative aims to relieve businesses’ administrative burdens by replacing less cost-effective solutions, such as the scanning-based digitisation of paper invoices, as well as paving the way for more comprehensive digitisation of a range of e-business processes. NemHandel achieves this by allowing the businesses to send standardised electronic invoices directly from their PCs via the internet in a secure and reliable fashion which frees up ressources to focus on their core business and on evolving their business. Furthermore, the use of the pervasive and well-known platform, the internet, very significant lowers barriers for SMEs as NemHandel is an exceptionally cheap, well-known and readily available solution to businesses of all sizes.

For public authorities and institutions the implementation of NemHandel also reduces administrative burdens as fully digital business documents can be processes automatically and significantly reduce the risk of errors occurring.

Strategic framework

Public provision of open infrastructure lays the foundation for a fully digitised society and stimulates a healthy eco system of IT vendors and service providers who deliver high-value solutions to businesses.

The private sector has not managed, or indeed taken the initiative, to achieve interoperability or the establishing of shared infrastructure services (e.g. addressing mechanisms, federated identity and access management services) and, that being the case, the Danish public sector has shown leadership and established the necessary shared infrastructure services. The NemHandel initiative enables nationwide interoperability and supports the formation of an ecosystem of commercial vendors and service providers offering NemHandel compliant solutions and services.

Implementation and Management Approach

The initiative is based on 1) public sector provision of an open infrastructure based on open standards, open source components, and the internet as connecting platform, and 2) private sector development and delivery of end-user software solutions and services.

The infrastructure supports exchange of business documents across heterogeneous networks and allows existing and new service providers to connect their solutions and networks to the infrastructure. The Danish National IT & Telecom Agency (NITA) has made freely available open source software components which IT vendors can use as building blocks to quickly and easily build actual solutions.

All interested parties are free to connect their solutions and networks, provided that they sign a multilateral contract that permits all signing organisations to exchange business messages and describes important non-repudiation aspects as well as the concept of gateways to other trusted network infrastructures.

Within a legal framework, the actual integration of the NemHandel technology into existing or new IT solutions and the connecting of other trusted networks to the NemHandel infrastructure is left entirely up to the individual interested parties, as is innovation and development of new functionality and services based on the NemHandel technology.

Public procurement is used as a key driver to ensure adoption by businesses. This is further supported by legislation making standardised electronic invoicing to public sector mandatory.

The use of existing document standards and transport networks will be accepted in coexistence with the NemHandel framework for a transistion period, allowing IT vendors and  service providers the time to market NemHandel-enabled solutions, and businesses sufficient time to adopt the NemHandel technology.

Critical mass from the beginning

All public authorities and institutions have been capable of receiving NemHandel invoices since the infrastructure was put in operation, thus ensuring critical mass from the beginning. Authorities and institutions that have not yet switched from using various proprietary networks for business document transport to using the NemHandel open infrastructure receive documents through a temporary gateway.

NemHandel is being implemented by the National IT and Telecom Agency in cooperation with the Commerce & Companies Agency and the Agency for Governmental Management.

Communications a key factor

Communications are regarded as key factor in the implementation of NemHandel. Communication and dissemination efforts are based on strategic cooperation with a wide range of partners, many of which representatives of key stakeholders. Partners include trade and industry organisations, non-profit business bureaus, financial advisers and chartered accountants, public authorities and institutions, and IT vendors and service providers.

The National IT and Telecom Agency has designed and manages the communications and dissemination strategy, handling over-all coordination, encouraging partners to initiate various communications efforts, and producing and publishing compelling and authoritative information material which partners are also invited to use, e.g. compelling website with user statement videos, information leaflets, visual brand identity for NemHandel (logo, fonts, catch phrases, etc.).

Major success factors

NemHandel addresses real business needs and delivers great value to businesses of all sizes as well as to the public sector.

NemHandel was designed, has been implemented, and will be maintained on the basis of open dialogue with key stakeholders.

Public sector has stepped in and provided an open common infrastructure, where the market was unable or unwilling to do so, thus tapping into the powerful democratic principles of the internet where no one entity ‘owns’ or controls the network, but everybody has the right and opportunity to utilize it to create more value.

The use of open standards and open source software components provides a more level playing field in the IT market and allows smaller IT solutions providers (software or online services), who previously did not have the capacity to compete, the opportunity to enter the market and contribute to a widening range of solutions to suit varying business needs.

NemHandel uses the internet as its basic platform which significantly lowers barriers for SMEs as NemHandel is an exceptionally cheap, well-known and readily available solution to businesses of all sizes.

Technology solution

Interoperability at all levels

Lack of interoperability is a major barrier to growth in e-government services. However, the private sector has been unable to establish common and open infrastructure services and this is why the public sector must show leadership and establish the necessary shared infrastructure that ensure interoperability. NemHandel addresses interoperability at all levels; organisational, technical and semantic.

Delivers value across sectors and industries

As an open and shared e-business framework, NemHandel delivers value across sectors allowing the exchange of business documents business-to-government as well as business-to-business. Providing one definitive set of common standards NemHandel also ensures interoperability between industries that previously maintained their own individual, often proprietary standards, and left businesses faced with a range of competing standards to support.

Strategic use of open source

As part of the ‘NemHandel’ initiative, the National IT & Telecom Agency has utilised the open source model strategically to promote adoption of the technology. NITA has developed a basic open source message handling reference client and made it freely available through the ‘Softwarebørsen’ open source software exchange to public sector institutions, private businesses, and to IT vendors who may easily incorporate the technology in their own commercial products. (Infrastructure components are also open source and thus interested parties, e.g. other nations, may essentially download their very own NemHandel infrastructure and put it into operation.)

Range of NemHandel-enabled solutions

A range of commercial IT vendors have already and others are in the process of integrating the 'NemHandel' technology into their products so that documents may be exchanged directly between existing IT solutions. Other IT vendors and service providers are developing a range of new NemHandel-enabled solutions to serve the needs of businesses of all sizes (e.g. simple web-based ‘software as a service’ solutions that cater to the needs of small and micro-sized businesses). Likewise a range of existing commercial service providers, e.g. banks and operators of value added networks (VAN) and other proprietary solutions, are looking to incorporate the technology into their services and connect their individual networks to the NemHandel infrastructure.

A common – and pervasive - platform

The use of the pervasive platform, the internet, has helped to very significantly lower barriers for SMEs as NemHandel is an exceptionally cheap, well-known and readily available solution to businesses of all sizes.

Document standardisation

Last but not least the use of document standards ensures interoperability at the content level. Having IT business systems provides no guarantee that even very central business processes, such as invoicing, may be handled seamlessly because of lack of interoperability at the content level. Instead valuable time is wasted on timeconsuming manual processes that are even prone to generating errors. NemHandel addresses this by providing document standards that ensure interoperability.

The central infrastructure components

The NemHandel infrastructure consists of the following technical elements:

• Addressing Mechanism
  Master registry based on the UDDI standard (Universal Description, Discovery and Integration) and any number of replicated runtime registries used for endpoint lookups.

• Infrastructure standards
  The standards used in the infrastructure are all open standards belonging to the WS* stack of standards. The standards are described in detail in an interoperability profile called RASP (Reliable Asynchronous Secure Profile). The profile narrows down the implementation choices and describes in detail various policies and how standards are used in combination. RASP varies from the WS-I profiles by also supporting SMTP/POP3 as an alternative message protocol in order to accommodate even the smallest businesses that are unlikely to have dedicated servers running 24 hours a day to receive messages at all times. However, using the SMTP/POP3 email protocol allows SMEs and micro-sized to receive business documents at any time.

• UBL documents
  NemHandel uses UBL 2.0 (Universal Business Language) as the common standard for definition of business documents format.

In addition, the NemHandel infrastructure makes use of digital signature, a public key infrastructure, to provide trustworthy and secure service. Businesses registre their endpoints and sign and encrypt business messages using digital certificates issued under the auspices of the national IT & Telecom Agency.

Impact

User impact and satisfaction

The official communications and dissemination campaign was initiated as recently as April 2009 and already more than 30,000 businesses have adopted the NemHandel technology. The National IT & Telecom Agency has established a NemHandel helpdesk to assist end-users and helpdesk consultants report very high user satisfaction.

Businesses are particularly satisfied with the ease of use, with document receipts, with the reduction of technical document errors to practically 0%, and with the wide range of available solutions. Many businesses even add ideas and requests for additional business services that could be delivered through the NemHandel infrastructure.

Providing more services on the basis of the infrastructure, and thereby adding more value to an existing technology, is an integral part of the strategic framework within which NemHandel has been established – and it is a strong indication that businesses understand and value the power of NemHandel.

ICT market impact

An increasing number of IT vendors and service providers have already integrated, or are in the process of integrating, NemHandel into their existing and new solutions, and the IT market has expressed satisfaction with legislation on public procurement standards as it sends a clear message from government as to the direction digitisation is meant to take and levels the playing field for IT vendors. This clearly demonstrates the key role NemHandel is playing in Denmark’s proactive policy approach to stimulate ICT market growth.

Technical impact

From a technical point of view, the NemHandel technology has already proven its capacity to reduce technical document errors to practically 0%. This is achieved through automatic document validation prior to sending, ensuring that only valid and uncorrupted UBL documents are exchanged.

Track record of sharing

The NemHandel infrastructure is based on open standards and open source and all components are freely available through the Danish public software exchange ‘Softwarebørsen’. The National IT & Telecom Agency (NITA) actively promotes and encourages reuse of the components and participate in various knowledge sharing activities.

Currently Denmark is a very active participant in the EU project PEPPOL (Pan-European Public Procurement Online), which aims to establish a similar open infrastructure to cover the European Union, contributing hands-on expertise to the design, development and implementation processes of the project.

A number of non-EU countries have expressed interest in learning from the Danish NemHandel case and the PEPPOL project, and the Danish National IT & Telecom Agency have previously provided information and infrastructure components to companies in Japan and South Korea.

NemHandel is designed with a with to encourage sharing and this approach has already in a powerful way demonstrated the sharing potential of the actual infrastructure and presented know-how export opportunities.

Lessons learnt

1. Public sector development and provision of an open national IT-infrastructure has mimicked and tapped into the powerful democratic principles of the internet where no one entity ‘owns’ or controls the net. 

• This provides excellent conditions for the growth of a healthy eco system of IT vendors and service providers of all sizes, who can all on an equal basis build ‘NemHandel-enabled’ solutions and services upon the infrastructure and rely on the common standards to be supported and maintained.  
• As the simple transport of data becomes greatly simplified and virtually cost-less in the open IT-infrastructure, enterprises and in particular SMEs can focus on their core business and on evolving their business. Additionally the provision of a definitive set of common standards in NemHandel ensures that businesses are no longer faced with a range of competing proprietary standards.  

2. Developing the NemHandel framework on the basis of actual business requirements gathered through an open dialoque with businesses, public authories, trade associations and IT vendores and service providers has made the NemHandel framework a powerful and effective technology. 

3. The use of the pervasive and well-known platform, the internet, has very significant lowered barriers for SMEs as NemHandel is an exceptionally cheap, well-known and readily available solution to businesses of all sizes. This demonstrates the power of helping businesses use existing and very low-cost technology to carry out vital business processes.