Producer Company

A Producer Company is a special form of company formed by primary producers such as farmers, weavers, artisans, or fishermen. It aims to collectively manage the activities of production, harvesting, processing, grading, and marketing of produce. Governed by the Companies Act, this company model operates on the concept of mutual help. easypaytax helps these producers gain better market access, technical support, and financial benefits. It strengthens their ability to scale operations, improve income, and contribute to rural prosperity by encouraging cooperation among producers.

India’s economy depends greatly on agriculture, with over half of the population engaged in farming and related activities. However, farmers often face challenges such as lack of funding, technology, and direct market reach. To address this gap, the concept of a Producer Company was introduced in 2002. With support from easypaytax, FPOs can uplift the lives of small producers by forming a legal entity that enables them to access better tools, infrastructure, and business opportunities.

Product Company - Incorporation Certificate [Sample]

What is a Producer Company?

A Producer Company is a legal corporate body made up of producers farmers, agriculturalists, or artisans who collaborate to undertake farming-related business operations. These include procurement, harvesting, marketing, processing, or selling of products, among others. In essence, the goal is to uplift the rural economy by granting access to financial aid, technology, and the marketplace. The company is incorporated under the Companies Act, 2013 and must have “Producer Company Limited” at the end of its name. easypaytax provides guidance to ensure proper setup and legal compliance.

According to Section 581B of the Companies Act, the key objectives of a Producer Company are:

Production, harvesting, procurement, handling, marketing, and selling of primary produce for the benefit of its members; this can be done independently or in partnership with other institutions.
Processing activities such as drying, brewing, canning, distilling, preserving, and packaging of produce.
Supplying equipment, machinery, or other consumables primarily to members.
Educating members on the values and practices of mutual cooperation.
Offering consultancy, R&D, training, and other support services for member welfare.
Managing power generation and conservation of land and water resources.
Providing insurance services for producers or their produce.
Promoting practices based on mutuality and cooperation.
Running welfare programs as approved by the Board of Directors.
Carrying out any additional or related activity to promote the principles of mutual assistance.
Financing procurement, marketing, and other producer-related activities through loans or credit.

Minimum requirements for Producer Company registration

Minimum 10 producers or individuals are required to form a production company but there is no upper limit
Or, at least two producer institutions are required to form a producer company
Out of 10 members, 5 directors are required to incorporate producer company
Minimum capital of 5 lakh rupees for producer company registration
Producer company cannot be converted into a public company

Process of Producer Company registration

Step 1. Application for Digital Signature Certificate (DSC)

Producer Company registration is a completely digital process; therefore, a Digital Signature Certificate requirement is a mandatory criterion. Directors as well as subscribers to the memorandum of the company need to apply for a DSC from the certified agencies. Obtaining a DSC is a complete online process and it can be done within 24 hours. This process involves 3 simple verifications that are document verification, video verification, and phone verification.

Step 2. Application for the Name Approval

Name application for Producer Company can be done through the SPICe RUN form which is a part of the SPICe+ form. While making the name application of the company, the industrial activity code as well as the object clause of the company has to be defined.

Note: It should be ensured that the business name does not resemble the name of any other already registered company and also does not violate the provisions of emblems and names (Prevention of Improper Use Act, 1950). You can easily check the name availability by using our company name search tool to verify the same.

Step 3. Filing of SPICe Form (INC-32)

Post name approval, details concerning the registration of the company have to be drafted in the SPICe+ form. It is a simplified proforma for incorporating a company electronically. The details in the form are as follows:

Details of the company
Details of members and subscribers
Application for Director Identification Number (DIN)
Application for PAN and TAN
Declaration by directors and subscribers
Declaration & certification by professional

Step 4. Filing of e-MoA (INC-33) and e-AoA (INC-34)

SPICe e-MoA and e-AoA are the linked forms that have to be drafted at the time of application for company registration.
A Memorandum of Association (MOA) is defined under section 2(56) of the Companies Act 2013. It is the foundation on which the company is built. It defines the constitution, powers, and objects of the company.
The Articles of Association (AOA) is defined under section 2(5) of the Companies Act. It details all the rules and regulations relating to the management of the company.

Step 5. Issuance of PAN, TAN and Incorporation Certificate

After approval of the above-mentioned documents from the Ministry of Corporate Affairs, a PAN, TAN, & Certificate of Incorporation will be issued by the concerned department. Now, the company is required to open a current bank account by using these documents. You can contact us for assistance with your current bank account opening.

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Producer Company