Do you want to open a producer company? Here in this article, we will guide on how to register an online producer company in India.
Entrepreneurs who want to start or already associated with agriculture and farming related business can open this type of company. Basically, it allows cooperatives or group of agro-preneurs to work as a legal corporate entity.
Producer company is always a better proposition than an individual farmer or cooperative. It has several advantages. Additionally, it creates a corporate platform and allows the members to access the several benefits.
Features of Producer Company
According to the MCA (Ministry of Corporate Affairs), the objects of the Producer Company shall relate to all or any of the following matters.
- Production, harvesting, procurement, grading, pooling, handling, marketing, selling, export of primary production of the Members or import of goods or services for their benefit.
- Processing including preserving, drying, distilling, brewing, vinting, canning and packaging of the produce of its Members.
- Additionally, 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, revitalization of land and water resources, their use, conservation and communications relatable to primary production.
- 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
- Finally, 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.
Advantages of Producer Company
- First of all, this type of business entity comes with limited risk and liabilities. The members of a producer company have limited liability as the company is an entity in itself. Therefore, you can lose only the amount invested in the business. So, the personal property of the directors would be safe.
- Secondly, producer company allows the members to scale up the business that an individual farmer can’t afford. With a producer company, multiple farmers can work as a collective and lower costs, reduce risk and even get access to better credit facilities. Therefore, it enables better strategy making and bargaining power with buyers.
- Finally, a producer company opens up better management activities. Generally, the board of management runs the company, not an individual. Also, it enables the organization to access the easy loans and financial assistance.
Related: NABARD Loan For Producers in India
Checklist for Producer Company Registration in India
Who Can Apply For Producer Company Registration
There are three different types of arrangements where registration can be applied. These are
- Any ten or more individuals, each of them being a producer
- Any two or more Producer institutions.
- A combination of ten or more individuals and Producer institutions.
Documents Required For Producer Company Registration
- Identity proof such as Voter’s ID/Passport/Driver’s License
- Pan card
- Passport for NRIs or foreign nationals
- Current Bank Statement/Telephone or Mobile Bill/Electricity or Gas Bill
- Members photograph
The registration process is simple. And you can also apply for online registration. First of all, the members need to have their own DSC (Digital Signature Certificate). Then they need to apply for DIN ( Director Identification Number).
The next step is securing a company name. Basically, the name has two different parts. The first part is unique and members can select according to their choice. However, the second part is fixed. The second part describes the business activity of the company. Finally, the name must end with ‘Producer Company Limited’.
After finalizing the name of the company and getting ROC approval, the members can file incorporation application. If the Registrar is satisfied that all the requirements of this Act have been complied with in respect of registration and matters precedent and incidental thereto, he shall, within thirty days of the receipt of the documents required for registration, register the memorandum, the articles and other documents, if any, and issue a certificate of incorporation.
After the registration, the producer company must carry out an internal audit of its accounts, at regular intervals in accordance with its articles of association.