Producer Company Overview

The Companies Act defines Producer as any person engaged in any activity connected with or relatable to any primary produce (Produce: “things that have been produced or grown, especially by farming”). A Producer Company is thus a body corporate having an object that is one or all of the following:

• production, harvesting, procurement, grading, pooling, handling, marketing, selling, export of primary produce of the Members or import of goods or services for their benefit.

Further, the Producer Company must deal primarily with the produce of its active Members and is allowed to carry on any of the following activities by itself or through other entities – on behalf of the members.

• processing including preserving, drying, distilling, brewing, vinting, canning and packaging of produce of its Members;
• manufacture, sale or supply of machinery, equipment or consumables mainly to its Members;
• providing education on the mutual assistance principles to its Members and others;
• rendering technical services, consultancy services, training, research and development and all other activities for the promotion of the interests of its Members;
• generation, transmission and distribution of power, revitalisation of land and water resources, their use, conservation and communication relatable to primary produce;
• insurance of producers or their primary produce;
• promoting techniques of mutuality and mutual assistance;
• welfare measures or facilities for the benefit of Members as may be decided by the Board;
• any other activity, ancillary 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 procurement, processing, marketing or other activities which include extending of credit facilities or any other financial services to its Members.

Producer Company Registration

To register a Producer Company in India, the following members in any of the combination is necessary:

• Ten or more individuals, each of them being a producer; or
• Two or more producer institutions; or
• A combination of ten or more individuals and producer institutions

The registration process for a Producer Company is then similar to that of a Private Limited Company. DSC and name approval must first be obtained. The name of a producer company must end with the words “Producer Limited Company”. Once, name approval is obtained from the MCA, application for incorporation can be filed in the prescribed format for incorporating the Producer Company.

If the Registrar is satisfied with the application for incorporation of Producer Company, then he/she will approve the same and issue Certificate of Incorporation. Once, a producer company is incorporated, it shall function similar to a private limited company subject to certain provisions. However, unlike a Private Limited Company, a Producer Company does not have a limit on the number of members. Further, though the name of a Producer Company ends with the words “Producer Limited Company”, it shall under no circumstance become or be deemed to become a public limited company.