What is a Producer Company?

A Producer Company, also known as a Farmer Producer Company, is an officially recognised farmer producer organisation composed of agriculturists or farmers. It combines features of private limited companies and cooperative societies. The goal is to improve members' income, sustainability, and resource utilization while being governed democratically.

Legal Framework

Producer Companies are governed by Section 465 of the Companies Act, 2013 and Part IX A of the Companies Act, 1956. The objectives must align with Section 581B of the Companies Act, 1956.

Objectives

• Enhancing income through marketing and export of primary produce.
• Importing essential goods/services for member welfare.
• Processing and packaging produce to add value.
• Providing equipment, training, technical services, and consultancy.
• Insurance, welfare, and mutual assistance programs.
• Financing member activities related to agriculture.

Advantages

• Hybrid between a private company and a cooperative.
• Owned by primary producers only, safeguarding interests.
• Limited liability and professional management structure.
• Minimal capital requirement (Rs. 1 lakh paid-up, Rs. 5 lakh authorised).
• Nationwide operations with no government/private stake.
• Unlimited member flexibility starting from 10 producers.

Membership & Governance

Membership is open to primary producers purchasing company shares. Governance is by a Board of Directors (minimum 5) elected by members, with each director serving a five-year term (re-electable twice).

Capital Requirements

• Minimum Authorised Capital: Rs. 5 lakhs
• Minimum Paid-up Capital: Rs. 1 lakh
• Capital can be increased as per the company’s memorandum.

How to Register with Hiva Professionals

1. Obtain DSC: Required for all proposed directors.
2. Get DIN: Apply for Director Identification Number.
3. Name Reservation: Submit Form SPICe+ with two name choices.
4. Prepare Documents: MoA, AoA, office address proof, affidavits, and director appointment forms.
5. File Incorporation Application: Submit SPICe+ with the ROC.
6. Receive Certificate: ROC verifies and issues incorporation certificate.

Post-Incorporation & Compliance

• Apply for PAN, TAN, open bank account.
• Mandatory audits and financial filings.
• Annual returns and board meetings.
• Maintain statutory reserve and avoid speculative activities.
• Eligible for NABARD registration and support.

Get Started with Hiva Professionals

Hiva Professionals offers end-to-end registration services for your Producer Company. Let our team help you empower your agricultural venture with legal expertise and smooth execution.