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Producer Company Registration
Producer Company Registration

Producer Company Registration

WHAT IS FARMER PRODUCER COMPANY?


A producer company is a body corporate engaged in any one or all of the following objects that is production, harvesting, grading, pooling, procurement, handling, marketing, selling, and the export of primary produce of the members or import of goods or services for their benefit.

The producer company’s primary object is to deal with the produce of its members and it must also carry on any of the following activities on behalf of its members:

  • Purifying including preserving, drying, distilling, brewing, venting, canning and packaging of the produce of its Members;

  • manufacture, sale or supply of machinery, equipment or consumables mostly to its Members;

  • Providing education on the mutual abetment principles to its members and others;

  • Provide technical services, consultancy services, training, research and development and all other activities for the promotion of the interests of its Members;

  • generation, dissemination and distribution of power, reanimation of land and water resources, their use, conservation and communication relatable to primary produce;

  • Indemnity of producers or their primary produce;

  • Promoting techniques of familiarity and mutual assistance;

  • Welfare measures or facilities for the benefit of Members as may be decided by the Board members;

  • any other activity, accompanying or incidental to any of the activities which may promote the principles of mutuality and mutual assistance amongst the Members in any other manner;

  • financing of procuring, processing, marketing or other activities which include extending of credit facilities or any other financial services to its Members

DOCUMENTS REQUIRED FOR PRODUCER COMPANY REGISTRATION

  • Copy of PAN Card of directors

  • Copy of Voter’s Id, Passport, Driver’s license

  • Copy of latest bank statement, mobile bill or electricity bill

  • Passport size photo of all directors

  • Address Proof of Registered Office

  • Copy of the rent agreement ( in case office is rented)

  • NOC from the property owner

  • Copy of sale deed

HOW TO REGISTER PRODUCER COMPANY IN INDIA?

A producer company must be formed by any of the combination of members:

  • Ten or more individuals, being producers;

  • Two or more producer institutions; or

  • An association of ten or more individuals and producer institutions,

The registration process for Producer Company and Private Limited Company is almost similar, which is as mentioned below:

  1. The first step is to apply for the DSC and DIN for the Producer Company's proposed Directors.

  2. An application for name availability and reservation can be filed with the Registrar of Companies after obtaining the DSC and DIN. The name should have the word “Producer Limited Company” suffix in company’s name.

  3. After receiving the name approval, you can file the incorporation application in the prescribed format for incorporating the Producer Company.

  4. The Certificate of Incorporation will be issued if the registrar is satisfied with the application and no objection was raised for the Incorporation of the Producer Company.

The functions of the producer company are similar to the Private Limited Company. But there is no limit on the maximum number of members in Producer Company unlike the Private Limited companies.

Even if the Producer Company's name suffix with the words "Producer Limited Company", it shall under no circumstance be considered as public limited company.

TYPES OF PRODUCER COMPANIES

  1. PRODUCTION BUSINESSES

    This type of companies work with the object of Production, Procurement or manufacturing of primary produce.

  2. MARKETING BUSINESSES

    A business engaged in the marketing or promoting the primary produce or provision of education services to members and others can also register itself as a Producer company.

  3. TECHNICAL SERVICE BUSINESS

    Any business that offers technical guidance to the producers, Provides training and educational services, or involve in the activities of research and development can register as a Producer company in India.

  4. FINANCE BUSINESS

    Any financial business that provide financial assistance to producer companies or producing activities then be it production, or marketing and development it can register itself as a producer company.

  5. INFRASTRUCTURE BUSINESS

    The business involved in providing infrastructure to the producers, whether in the form of electricity, water resources, land utilization, irrigation techniques, or consultation regarding the same, may also constitute themselves as a Producer company.

BENEFITS OF PRODUCER COMPANIES

Following are the benefits of Producer Company:

  • The members of a producer company have unlimited liability as the company is has a status separate legal entity. The amount invested in the business would be lost, and the directors' property would be safe.

  • Producer companies' work is divided among the directors, a single farmer has not to manage their entire business. The entity is governed by the Management Board, which has tenure of five years.

  • Members of the producer company will be authorized to get bonus shares in the proportion to the shares held by them.

NABARD LOAN FOR PRODUCER COMPANIES

Producer Companies were introduced to allow farmers cooperatives to function as a corporate entity under the ministry of corporate affair. A producer company can provide financial assistance to its members through it.

Producer Organization Development Fund

NABARD set up a Rs. 50 crore Producer Organization Development Fund (PODF) out of its operating surplus for supporting producer organizations and acquiring a flexible approach to meet the producers' needs.

This scheme allows financial support in the form of loans or grants provided for any registered Producer Company. MACS, Industrial Cooperative Societies, and other registered federations set up by the producers.

This Producer Organization Development Fund will support the producers' organization or producer companies by providing credit support, improving capacity, and building market connection.

In this scheme, activities introduce within the agriculture, allied, and non-farm sectors. Various activities like harvesting, storage, processing, packaging, and or marketing of the produce/ product is entitled for support under the PDOF fund.

The Producer Company should be formed by the primary producers of agriculture and the non-farm sector. The producer organization or company must incorporate only for the benefit of the producers.

Further, the producer company's shares cannot be sold to non-producers and if any existing member wants to resigns the producer company, there shares can only be purchased either by an existing producers or by appointing a new primary producer.