Producer Company

A producer company is a type of business entity formed by primary producers like farmers, artisans, fishermen, etc., with the aim of collectively processing, producing, harvesting, grading, marketing, or selling their produce. These companies operate on the principle of mutual assistance and are governed by the Companies Act. They empower small-scale producers by providing them with a platform for collective bargaining, accessing better technology, and improving market access. Producer companies contribute to rural development and economic growth by fostering cooperation among producers and enhancing their socio-economic status.

Farmer Producer Organization (FPO Registration)

India's economy is primarily agrarian. Agriculture is the primary source of income for the bulk of the Indian population, employing more than half of the workforce. But the unfortunate thing is that producers and farmers are disadvantaged in the agricultural process. They lack access to technology, knowledge, and funding. To solve this issue, the Producer Company idea was created in 2002 to improve the lives of farmers and producers.

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Product Company - Incorporation Certificate [Sample]

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What is a Producer Company?

Producer company is a corporate body of producers, farmers and agriculturists with the objective of procurement, production, harvesting, grading, pooling, handling, marketing, selling or export of the members or import of goods and services for themselves.

In simple words, this type of company is formed with the aim to improve the lives of people associated with the agriculture industry by providing them access to technology, market, credit, etc.

It is registered as a public company under the Companies Act, 2013 and must include “Producer Company Limited'' as the last words of its name.

The objects of the Producer Company given under Section 581B (as per the law) are as follows:

The objects of the Producer Company shall relate to all or any of the following matters, namely : -

  1. Production, harvesting, procurement, grading, pooling, handling, marketing, selling, export of primary produce of the Members or import of goods or services for their benefit; Provided that the Producer Company may carry on any of the activities specified in this clause either by itself or through another institution;
  2. Processing including preserving, drying, distilling, brewing, vinting, canning and packaging of produce of its Members;
  3. Manufacture, sale or supply of machinery, equipment or consumables mainly to its Members;
  4. Providing education on the principles of mutual assistance to its Members and others;
  5. Rendering technical services, consultancy services, training, research and development,, and all other activities for the promotion of the interests of its Members ;
  6. Generation, transmission, and distribution of power, revitalization of land and water resources, their use, conservation; and communications relatable to primary produce;
  7. Insurance of producers or their primary produce;
  8. Promoting techniques of mutuality and mutual assistance;
  9. Welfare measures or facilities for the benefit of members, as may be decided by the Board;
  10. Any other activity, ancillary or incidental to any of the activities referred to in clauses (a) to (i) or other activities which may promote the principles of mutuality and mutual assistance amongst the Members in any other manner;
  11. Financing of procurement, processing, marketing, or other activities specified in clauses (a) to (j) which include extending credit facilities or any other financial services to its Members.

Documents required for Producer Company registration

  1. Passport size photographs of the members
  2. Copy of PAN Card of the members
  3. Copy of Aadhar Card or Voter ID
  4. Bank statement (not older than two months)
  5. Proof of registered place of business like utility bill
  6. No Objection Certificate from the owner of the property

Minimum requirements for Producer Company registration

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

  1. Details of the company
  2. Details of members and subscribers
  3. Application for Director Identification Number (DIN)
  4. Application for PAN and TAN
  5. Declaration by directors and subscribers
  6. 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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