Producer Company Registration: Guide and Process

A producer company is a company registered under the companies act, 2013, which has its objectives. It is a cluster of people. This concept was introduced mainly for the aim of framing legislation and permitting the incorporation of cooperatives as companies and their conversion of existing.

Every producer company shall deal primarily with the produce of its active members for carrying out any of the objects. Also, the company must be a company limited by shares. Company Registration will be when the producer company will become a body corporate if it is a private company. The company must not under any circumstances whatsoever become or deem to become a public company. Read more

How to register a producer company?

• Producer company registration requires a few activities or objectives to perform which specify under Section 581B.

• Production, procurement, harvesting, pooling, grading, marketing, selling, and export of the primary producers of the members. If the producer company must continue these activities themselves or through other institution;

• It’s processing including drying, preserving, brewing, venting, canning, distilling, and packaging of the produce;

• It manufactures, supplies  or sells machinery, equipment or consumables to its members;

•  Imparting of knowledge on the mutual assistance principles to its members;

•  Delivering technical services, consultancy services, training, and other activities for the promotion of interests of its members;

•  Insurance of producers and or the primary producers.

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Documents required for a producers company registration

AOA and MOA duly signed, dated and stamped.

Power of attorney 

The statutory declaration in the e-form-1(on stamp paper) declaring compliance of all and incidental matters regarding the formation of companies.

Payment of stamp duty is made electronically through the MCA portal. In case it is not paid electronically, then the submission of original stamped physical copies of the uploaded e-form-1, AOA, MOA along with the text of the challan in the concerned office of ROC.

Filling of Form-18

Filling of Form-32

Registration fees

Producer Company Registration Fees is mentioned below: 

The Producer Company Registration Fees are to pay by filing an application FORM-1A along with a fee of Rs.1000. Click here for the form details. 

What is a Farmers Producer company?

Over 85% of the farmers in India are small and insignificant farmers having land holdings of less than 2 hectares. This eradication in farmers and farmlands leads to disorganization, and it is not viable for Indian farmers to adopt the latest technologies. Click here to know more.

Economies of scale can be unlocked, and the livelihood of farmers improves by organizing the Farmers Company. Thus the concept of producer company aims at empowering farmers by creating clusters of farmers organized as a company.

A Farmers Company can form by any ten or more primary producers or by two or more producer institutions, or even by a contribution of both. They can undertake activities related to production, harvesting, grading, pooling, etc.., of agricultural produce.

A few critical points of Farmers Producer Company are:

•  To organize farmers into a collective group to improve their bargaining strength in the market.

• The shareholder farmers own and govern it, and the professional managers help in administration.

• They adopt all the ethical principles of the cooperatives and the efficient business practices of companies and also seek to address the inadequacies of the cooperative structure. 

• The nonproducers seeking to invest in these companies as shareholders are precluded under the statue concerned.

Each producer or member of the farmer company is with equal voting rights irrespective of the number of shares held. There is a limitation on the amount that one can distribute as a dividend. Also, for professional guidance, 5-15 directors and expert directors can be appointed.