Producer Company Registration
A Producer Company is a company registered with the Ministry of Corporate Affairs (MCA) to focus on activities related to agricultural production and processing.
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- Name Reservation
- DSC & DIN
- Drafting & Filing Application for Producer Company Registration
- Documentation
- End-to-end support
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Producer Company Registration - Overview
A Producer Company is a unique business structure aimed at empowering farmers, producers, and rural entrepreneurs to work together for better economic opportunities. This type of company allows individuals involved in agriculture, farming, and production activities to pool resources, share profits, and make decisions collectively.
Key Benefits of a Producer Company:
- Collective Power – Members combine resources to buy, sell, and market more effectively.
- Access to Financial Support – Producer Companies often receive benefits like subsidies and grants from the government.
- Profit Sharing – Surplus profit is shared among members, creating a stable income for all.
- Improved Market Reach – Joint efforts help expand market reach, benefiting all members.
Steps to Register a Producer Company:
- Choose a Name – Select a unique name and get approval from the Registrar of Companies (ROC).
- Prepare Required Documents – Submit identity proof, address proof, and other necessary documents for members.
- Draft Key Documents – Articles of Association (AOA) and Memorandum of Association (MOA) are needed to outline business goals and operational rules.
- File with ROC – Submit the application to the Registrar, who reviews it and issues a Certificate of Incorporation once approved.
A Producer Company is a valuable choice for groups looking to strengthen their presence in the market, share resources, and achieve better economic stability through collective efforts.
Advantages of Producer Company Registration
Collective Power and Better Bargaining
Producer companies enable small farmers, producers, and rural entrepreneurs to combine their resources, allowing them to buy inputs, sell products, and negotiate with suppliers and buyers on more favorable terms.Access to Government Support
Registered Producer Companies often qualify for subsidies, grants, and financial aid under various government schemes. These benefits are designed to support agriculture, rural development, and small producers.Profit Sharing Among Members
Profits are distributed among the members, offering a stable and collective income stream. Members receive dividends, bonuses, or additional shares based on the company’s financial performance.Limited Liability Protection
Like other registered companies, Producer Companies provide limited liability protection to members, meaning individual assets are protected in case of financial losses or debts.Enhanced Market Reach and Brand Identity
Working as a group under a single entity helps expand market reach and build brand identity, giving members access to larger markets and better pricing.Tax Benefits and Lower Costs
Producer Companies often enjoy tax exemptions and benefits, especially those involved in agricultural activities, which reduce operating costs and increase overall profitability.Professional Management and Stability
Registered Producer Companies are governed by structured regulations, ensuring transparency, better decision-making, and long-term business stability. This organized approach helps create an environment of growth and sustainability for all members.
Forming a Producer Company is a strategic choice for producers who aim to achieve economic stability, tap into larger markets, and maximize the benefits of working collectively.
Documents Required for Producer Company Registration
Identity Proof of All Members and Directors
- PAN Card (mandatory for Indian citizens)
- Passport (for foreign nationals)
Address Proof of All Members and Directors
- Aadhar Card, Voter ID, Driving License, or Passport
- Recent utility bill (electricity, water, or gas) or bank statement (not older than 2 months)
Registered Office Address Proof
- Ownership proof (electricity bill, property tax receipt, etc.)
- NOC (No Objection Certificate) from the property owner if the office is rented
- Rent agreement (if applicable)
Passport-sized Photographs of All Members and Directors
Digital Signature Certificate (DSC)
- Required for all directors for signing electronic documents during the registration process.
Director Identification Number (DIN)
- DIN must be obtained for all directors if not already available.
Articles of Association (AOA) and Memorandum of Association (MOA)
- These documents outline the company’s objectives, structure, and internal rules.
Declaration of Compliance
- A statement confirming that all necessary legal requirements for registration are fulfilled, signed by a practicing professional (CA, CS, or advocate).
Having these documents prepared and organized will streamline the Producer Company registration process, making it quicker and more efficient for applicants.
Procedure for Producer Company Registration
Obtain Digital Signature Certificate (DSC)
All directors must obtain a DSC, which will be used to digitally sign documents during the registration process. This can be obtained from certified agencies.Apply for Director Identification Number (DIN)
Each director must have a DIN, which can be applied for through the Ministry of Corporate Affairs (MCA) portal. DIN is essential for director identification.Name Approval Application
Select a unique name for the company and apply for name approval on the MCA portal. The name should comply with the MCA naming guidelines and include “Producer Company” at the end.Prepare and Submit Key Documents
Draft the Memorandum of Association (MOA) and Articles of Association (AOA), which outline the company’s objectives, structure, and rules. Other essential documents, such as identity and address proofs of directors, are also submitted at this stage.File Registration Application with ROC
Complete the application (Form SPICe) on the MCA portal and submit all required documents, including the MOA, AOA, DSC, DIN, and name approval confirmation. Pay the applicable registration fees.Verification by Registrar of Companies (ROC)
The Registrar reviews the application and submitted documents. If any corrections are needed, they will notify the applicant. Once all requirements are met, the ROC proceeds with approval.Receive Certificate of Incorporation
Upon successful verification, the ROC issues a Certificate of Incorporation along with a unique Company Identification Number (CIN). This certificate confirms the legal existence of the Producer Company.Post-Registration Compliance
After registration, the Producer Company must open a bank account in the company’s name, maintain regular records, and comply with ROC filing requirements.
By following these steps, a Producer Company can gain legal status and start operations, empowering its members with collective benefits and growth opportunities.
Frequently Asked Questions
To register a Producer Company, you need at least five directors. Additionally Or any two or more Producer Institutions, or a combination of ten or more individuals and Producer Institutions to set up the company.
The minimum capital required to register a Producer Company is ₹5 lakh.
Only primary producers primary producers can become members of a Producer Company. This includes individuals involved in activities like farming, agriculture, fishing, forestry, and other production-related businesses.
Yes, it is mandatory for a Producer Company to get its accounts audited every year. This ensures financial transparency and compliance with legal regulations. The audit must be conducted by a certified auditor.
Yes, a Foreign National or Non-Resident Indian (NRI) can become a director in a Producer Company. However, at least two-thirds of the directors must be Indian citizens. Additionally, the foreign director must fulfill the legal requirements for becoming a director in an Indian company.
No, you do not need to be personally present to register a Producer Company. The entire registration process can be completed online through the Ministry of Corporate Affairs (MCA) portal. You can submit the required documents and forms digitally, and the registration can be done remotely with the help of professionals like Company Secretaries or Chartered Accountants.
No, the shares of a Producer Company cannot be freely transferred like in other types of companies. According to the law, the transfer of shares in a Producer Company is subject to certain restrictions. Shares can only be transferred to other members of the Producer Company, and the transfer must be approved by the board of directors. This ensures that the company remains focused on its core objective of benefiting its producers and maintaining control within the group.
The time taken to incorporate a Producer Company can vary, but typically it takes 15 to 20 business days for the registration process to be completed. This includes the time required for name approval, document verification, and obtaining the Certificate of Incorporation from the Registrar of Companies (ROC). Factors such as the completeness of documents and prompt communication with relevant authorities can affect the timeline.
In a Producer Company, a nominee is appointed to represent the interests of the members in case of death or incapacity. The process to appoint a nominee generally involves the following steps:
Selection by Members: Each member of the Producer Company can nominate an individual to represent their shareholding in case of death or incapacity. The nomination must be done in writing.
Filing with the Company: The nominee details must be submitted to the company, and the company must keep a record of these nominations.
Approval of the Board: The nominee’s appointment must be approved by the board of directors to ensure it complies with the company’s regulations.
Nominee Rights: In the event of the member’s death or incapacity, the nominee is entitled to the member’s shares and other benefits, as per the terms of the company’s articles and the member’s agreement.
This ensures that the nominee is recognized and can take over the member’s rights in case of unforeseen circumstances.
A Producer Company is classified as a private company under the Companies Act, 2013. However, it has certain unique features that distinguish it from a regular private company.
For example, a Producer Company can have more than 200 instead of 50 members, and its focus is primarily on the production and processing activities of its members. While it operates as a private company, its purpose and structure are specifically designed to benefit the producers or members engaged in agricultural or production-based activities.
In India, Producer Companies can be broadly categorized based on the type of production or activity the members are involved in. The key types of Producer Companies include:
Agricultural Producer Companies
These companies are formed by farmers or agricultural producers for the collective benefit of farming activities, such as the marketing, processing, and sale of agricultural products (e.g., crops, dairy, fruits, vegetables).Dairy Producer Companies
These are formed by dairy farmers for the collective production, processing, and marketing of milk and dairy products. Members pool resources for better quality control, marketing, and distribution of dairy products.Fisheries Producer Companies
These companies are formed by fishermen or fish farmers to collectively manage fish production, processing, and marketing, ensuring better pricing and access to wider markets.Forest Producer Companies
These companies are formed by individuals engaged in forest-based activities such as the collection of forest produce (e.g., herbs, timber, bamboo) for processing and marketing collectively.Handicraft and Handloom Producer Companies
These are formed by artisans and handloom weavers who come together to sell and market their products collectively, improving their reach and access to markets.Mineral and Mining Producer Companies
These are formed by producers involved in mining or mineral extraction, aiming to collectively manage production, processing, and marketing of minerals.
Each type of Producer Company focuses on a specific production sector, and members work together to improve their economic condition by sharing resources, reducing costs, and accessing better market opportunities.
To start a Producer Company in India, the following requirements must be met:
1. Minimum Number of Members
- Ten or more individuals, or
- Two or more producer institutions (such as cooperative societies, producer cooperatives, or farmer producer organizations).
- Members must be involved in primary production activities like farming, agriculture, dairy, handicrafts, etc.
2. Minimum Number of Directors
- At least five directors are required to form a Producer Company. These directors can be individuals who are also members of the company.
- A Producer Company must have a minimum of two-thirds of the directors as Indian citizens.
3. Legal Structure
- The company must be formed as a private limited company under the Companies Act, 2013.
- It must include “Producer Company” as part of its name.
4. Memorandum of Association (MOA) and Articles of Association (AOA)
- These documents must clearly state the company’s objectives, rules, and regulations.
- The MOA and AOA must focus on the welfare of producers and promote collective production, marketing, and processing of goods.
5. Registered Office
- A registered office address in India must be provided for the company. This is where all official correspondence will be sent.
6. Capital Requirement
- The minimum capital requirement is ₹5 lakh for registering a Producer Company. This capital can be raised through member contributions or other sources.
7. Compliance with Legal and Regulatory Requirements
- The Producer Company must comply with the regulations laid out by the Ministry of Corporate Affairs (MCA) and other relevant authorities.
- The company must also be registered with the Registrar of Companies (ROC).
8. Member and Director Identification
- All directors and members need to provide their identity proof (PAN, Aadhar, Passport) and address proof.
- Directors should also apply for a Director Identification Number (DIN), if they don’t already have one.
9. Nominee
- Each member can nominate a person to represent their shareholding in case of death or incapacity.
10. Compliance with Cooperative Principles
- The company should operate based on cooperative principles, focusing on the collective benefits of its members and promoting democratic governance.
By meeting these requirements, individuals and groups involved in primary production activities can come together and establish a Producer Company that aims to improve their economic status through collective efforts.