Public Limited Company Registration
A company that is publicly listed can offer the advantages of limited liability to its shareholders and allows them to sell their shares to raise funds. This means that anyone interested can invest in the shares of a publicly listed company.
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Overview of Farmer Producer Company Registration in India
The registration process for a Producer Company in India is similar to that of a Private Limited Company. Required documents for online registration of a producer company include those for promoting or incorporating producers. Filing Buddy offers online registration services for Producer Companies in India to farmers who wish to start their own businesses.
Agriculture is the backbone of India’s economy, with approximately 60% of the population depending on it for their livelihood. Still, despite this farmers and primary producers need help to earn a decent profit.
Most Producer Companies in India are owned by marginal or small-scale farmers who own less than 2 hectares of land. Due to poor facilities and low production, farmers’ lives are often complex. In response to this issue, the Government of India established an expert committee led by Y.K. Alagh to address the matter. In 2002, the committee introduced a new concept called Producer Companies to help uplift Indian farmers and producers collectively. Since then, the committee has been working towards this primary goal.
What is a Producer Company?
A ‘Producer Company’ is a legally recognized entity that is formed with the primary goal of improving the standard of living for farmers and agriculturists. To establish a Producer Company, individuals or farmers must obtain a Farmer Producer Company Registration in India, in accordance with the government’s rules and regulations.
The Producer Company is established under the Companies Act 1956, under which a Producer Company must be formed by 10 individuals and 2 institutions. or a combination of both. The company’s business objectives are:
- Selling
- Production
- Procurement
- Export
- Grading
- Pooling
- Harvesting
- Handling
- Marketing
Advantages of Registration of Farmer Producer Company
The registration of a Producer Company in India offers numerous advantages, similar to those of a Private Limited Company. Some of the benefits are listed below:
- Limited Liability:
The members of a Producer Company are protected by limited liability, which means that their personal assets are not liable to cover the losses or debts of the company.
- Separate Legal Entity:
Like a Private Limited Company, a registered Producer Company is considered a separate legal entity that can buy or sell land in its own name.
- More Credibility:
Registered Producer Companies are viewed as more credible than non-registered companies.
- Easy Management:
Applicants for a Producer Company can easily make desired changes in the board of management by filling out a few simple forms and submitting them to the Registrar of Companies (ROC).
These advantages make the process of Farmer Producer Company Registration in India more beneficial for farmers and primary producers. It can lead to increased production and better credit utilization, resulting in higher profits for their farming produce. Overall, a Producer Company is a boon for all primary producers or farmers in India.
Checklist to form a Producer Company Registration in India
- Minimum Directors and Members:
A minimum of 5 directors and 10 members are required to register the company.
- Paid-up Capital:
The minimum paid-up capital required to register a Producer Company is approximately Rs. 5 lakhs or more.
- No Maximum Limit:
There is no maximum limit to the number of members required to incorporate a Producer Company.
- Not a Public Limited Company:
A Producer Company cannot be registered or considered as a Public Limited Company.
- Equity Share Capital:
A Producer Company can only own equity share capital.
- Board Meetings:
The company must conduct at least four board meetings every year, with one meeting held every three months.
Other Mandatory Requirements for Registration of Farmer Producer Company in India
When registering for a Farmer Producer Organization, the following additional requirements must be fulfilled:
- Farming-Related Activities:
Only one individual or member who is involved in farming activities related to the production of primary produce can participate in the ownership of the company.
- Primary Producers:
All the members of the company must be primary producers.
- Limited Liabilities:
The liabilities of the members of the Producer Company are limited to their unpaid share amount.
- Company Name:
The proposed company’s name should include “Producer Company Limited” at the end.
- Private Limited Company:
As per the provisions of the Companies Act, the proposed Producer Company is considered a private limited company.
Rules and Regulations for Easy Availability of Loans and Credits
Producer companies in India aim to improve the standard of living for primary producers:
- Loans are provided to farmer producers or members of the company through special provisions.
- The NABARD loan scheme is available to members of a producer company, which is facilitated by the National Bank for Agriculture & Rural Development (NABARD) to help small and regional-scale farmers meet their financial requirements.
- Producers or members of the company can access credit facilities for a period of 6 months or less as per the law.
- Loans and advances are granted to members of the company against security for a period of 7 years or less from the date of disbursement of the loan as per the law.
Activities Performed by the Farmer Producer Company Registration in India
As mentioned, the online registration of the farmer producer company manages all the activities related to farmers’ production, harvesting, and post-harvesting. The following are the details of activities performed by the Producer Company:
Processing of crops and farm products:
The producer company begins its operations with crop processing, which involves several steps such as brewing, drying, preserving, venting, distilling, canning, and packaging.
Manufacturing of crops and farm products:
The manufacturing process involves large-scale production using high-tech farming machines. The company also supplies and sells necessary machines and equipment for improved results and manufacturing.
- Low-scale farmers are educated on new farming technologies, providing them with assistance and guidance in growing crops and performing farming activities more effectively.
- The mutual assistance principle is taught to members of the Farmer Producer Company.
- Various farming-related services, such as consultancy, technical training, and other activities, are provided to promote farming activities, tailored to the producer’s requirements and interests.
- Primary production and producer insurance are provided.
- The company promotes the efficient use of power, water, and land resources.
- Various farming techniques related to mutuality and mutual assistance are promoted by the producer company in India.
- Financial guidance and assistance are offered to members of the Producer Company for marketing, procurement, or other activities.
Attention:As per the Companies Act of 2013, primary produce” means – the produce of farmers, arising from agriculture (including animal husbandry, horticulture, floriculture, pisciculture, viticulture, forestry, forest products, re-vegetation, bee raising, and farming plantation products), or from any other primary activity or service which promotes the interest of the farmers or consumers or produce of persons engaged in handloom, handicraft, and other cottage industries.
Documents needed for Producer Company Registration in India
- Latest Bank Statement or Telephone or Mobile Bill
- PAN Card or Passport or Election ID Card
- Passport-sized photos of all directors and shareholders of the Producer Company
- Voter’s ID or Passport or Driver’s License
Documents needed for Proposed Registered Office (Residential Or Commercial):
- If the Producer Company is renting a place, they need to provide a copy of the rent agreement along with a NOC from the owner.
- A copy of any utility bills, such as an electricity bill, is also required.
- If the Producer Company owns the property, they need to provide a copy of the property papers.
Registration Procedure of Farmer Producer Company in India
The registration process of a Producer Company in India follows the same rules and regulations as a Private limited company.
- The first step is to obtain a Digital Signature Certificate (DSC) and Director’s identification number (DIN) for all company directors.
- Next, the company name availability is checked, and an application is made.
- Required documents like a Memorandum of Association (MoA), Articles of Association (AoA), and others are drafted, and EMOA and EAOA are filed to register the Producer Company.
- After successfully verifying documents, the Registrar of Companies (RoC) issues a certificate of incorporation along with PAN and TAN.
- The company then opens a current account in an authorized bank.
- It takes around 7-15 days for the verification process of documents, and if all requirements are met, the incorporation certificate of the producer company is issued.
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