Producer Company Registration

• An excellent option for persons involved in any activity related to finance.
• Five DINs & DSCs
• All five directors must be registered with the MCA
• Company Name Reservation
• We will then help you pick a unique name
• MoA & AoA
• We will draft your company's constitution
• SPICe i.e. INC-32 Approval
• Your company is now incorporated
• Company PAN & TAN
• We will send in a request to the NSDL

What is Producer Company Registration?

A Producer Company was introduced in India with the Companies Act, 2013. It gives persons engaged in activities related to produce (what has been grown or produced, particularly by farming) the opportunity to form a company. A producer company can be formed by 10 or more producers (persons involved in, or in activities related to, produce or growth), two or more producer institutions or a combination of 10 or more producers and producer institutions. Such a company can only have equity capital, require a minimum of five directors and an authorized capital of Rs. 5 lakh. The procedure for forming a producer company is similar to the one for forming a private limited company.

Types of Producer Companies

• Production Businesses
• The main type of producer companies are those involved in production, procurement or manufacture of any primary produce for its members (for further sale) and to others.
• Marketing Businesses
• Even a business involved in the marketing or promotion of primary produce or provision of educational services to members and others can constitute itself as a producer company.
• Technical Service Businesses
• Any business offering technical assistance to producers, providing training and educational services or conducting research and development can register as a producer company.
• Financing Businesses
• Any business financing producer activities, be it in the production, marketing or development domain, can register itself as a producer company.
• Infrastructure Businesses
• Businesses involved in providing infrastructure to producers, whether in the form of electricity, water resources, irrigation techniques, land utilisation, or consultation with regard to the same, may constitute themselves as a producer company.

Documents Required for Producer Company Registration

TO BE SUBMITTED BY DIRECTORS & SHAREHOLDERS

• Scanned copy of PAN Card or Passport (Foreign Nationals & NRIs)
• Scanned copy of Voter's ID/Passport/Driver's License
• Scanned copy of the Latest Bank Statement/Telephone or Mobile Bill/Electricity or Gas Bill
• Scanned passport-sized photograph
• Specimen signature (blank document with signature [directors only])

Note: Any one of the directors must self-attest the first three documents. In case of foreign nationals and NRIs, all the documents must be notarised (if currently in India or a non-Commonwealth country) or apostilled (if in a Commonwealth country).

FOR THE REGISTERED OFFICE

• Scanned copy of the Latest Bank Statement/Telephone or Mobile Bill/Electricity or Gas Bill
• Scanned copy of Notarised Rental Agreement in English
• Scanned copy of No-objection Certificate from property owner
• Scanned copy of Sale Deed/Property Deed in English (in case of owned property)

Note: Your registered office need not be a commercial space; it can be your residence, too.

Advantages of a Producer Company

•  Limited Liability All businesses can run the risk of not being able to repay their liabilities. It is a necessary evil. In this event, a sole proprietor (or individual producer) would be personally liable for all the debts of the business. The members of a producer company, on the other hand, have unlimited liability as the company is an entity in itself. Therefore, only the amount invested in the business would be lost; the personal property of the directors would be safe.
•  Economies of Scale Only 15% of India's farmers own over two acres of land. The majority of farmers are, therefore, unable to safely unlock the advantages that come with economies of scale. With a producer company, multiple farmers can work as a collective and lower costs, reduce risk and even get access to better credit facilities. This enables better planning and bargaining power with buyers.
•  Better Management Rather than a single farmer managing the entire business, work within a producer company can be divided between its directors. The entity is managed by the Board of Management, which has a tenure of five years. Also, a producer company has a separate legal existence, which means that it isn't affected by the death of any of its members.