Producer Company is a form of business structure incorporated by producers who are involved in the production of primary produce or having one or more objectives related to the primary production. Through this article we will take a deeper insight into the concept of Producer Company.
The concept of Producer Company was introduced in the year 2002 to facilitate the incorporation of cooperatives as companies and the conversion of existing cooperatives. The Producer Company can undertake only those objectives that are specified in section 581B of Companies Act.
Objectives of Producer Company
A company formed is said to be the producer company only when it is incorporated with the objectives mentioned below -
- Manufacture, harvesting, obtaining, grading, pooling, handling, marketing, selling, export of primary production of the Members.
- The activities in processing including preserving, drying, distilling, brewing, vinting, canning, and packaging of the produce of its Members
- For the members manufacturing, selling or supplying of machinery, equipment or consumables
- On the provision of mutual assistance imparting education to its Members and others.
- Providing technical services, consultancy services, training, research and development and all other activities for the raise of the interests of its Members.
- Generation, transmission, and distribution of power, revitalization of land and water resources, their use, conservation and communication relatable to primary production.
- Providing insurance of producers or their primary produce.
- Encouraging techniques of mutuality and mutual assistance.
- Welfare measures or facilities for the benefit of Members as may be decided by the Board.
- The activities endorsing the principals of mutuality and mutual assistance amongst the Members and any other activities ancillary or incidental to any of the activities mentioned above
- Providing money for the procurement, processing, marketing or other activities specified in clauses (a) to (j) which include extending of credit facilities or any other financial services to its Members.”
Who can incorporate the Producer Company?
In order to obtain the registration of Producer Company, it is necessary to have below-mentioned member individually or in combination with one another -
- Ten or more individuals and every one of them being a producer; or
- Two or more producer institutions; or
- A combination of ten or more individuals and producer institutions
Required Documents for Producer Company
Following documents are required for registration of a producer company -
- PAN Card copy of all the directors
- Passport size photographs of the directors
- Voter identity card/Aadhaar Card copy
- Rent agreement copy(If it is a rented property)
- Water/Electricity bill copy (Business Place)
- Property papers copy (If owned property)
- NOC of the landlord.
Producer Company registration procedure
The procedure of registration for Producer Company is very similar to the registration of the private limited company. Below we have outlined the steps to incorporate the producer company in India -
- Apply for DSC - To initialize the procedure of producer company registration every director of the company is required to obtain the digital signature certificate. Digital Signature Certificate (DSC) is a digital signature which can be attached to an electronic document to verify the applicant’s identity.
- Apply for DIN - After obtaining the DSC the director needs to obtain a DIN. DIN is eight digits unique number allotted to every person who wants to become a director. It is allotted by the ministry of corporate affairs.
- The draft memorandum of association and articles of association:
- Memorandum of Association - Memorandum of association is a document which defines the relationship of the shareholders with the company. It basically contains the objectives and powers of the company.
- Articles of association - They are the bye-laws which define the relationship of the company with outsiders. Information such as the total number of members, share capital, rules for a meeting of the company, voting power of members must be included in the Articles of Association.
- Filing the forms - Various forms like INC – 7, INC – 22 and DIR – 12 and uploaded to the ROC website.
- Obtain the certificate of incorporation-On proper verification of the forms filed and documents submitted the ROC will issue a Certificate of Incorporation and the company can start its business operations.
Also read: How to Become a Mutual Fund Distributor?