A Producer Company is a unique corporate body delineated under section 581B of the Companies Act, 1956. It's structured to facilitate activities related to various agricultural, post-harvest processing, and primary production realms.
Producer Companies aim at a range of objectives including but not limited to:
Such a company can be formed by either:
Upon meeting specific standards and submitting the required documents, the registrar authenticates the company's formation by issuing an incorporation certificate within a month.
The essential nature of a Producer Company revolves around catering to the post-harvest and agricultural requirements of its members. It's designed to aid in various stages like production, grading, pooling, handling, selling, and marketing of the primary products generated by its member producers.
Producer Companies are instrumental for the small and marginal farmers in India, which constitute about 85% of the farming community. These farmers usually own lands less than 2 acres, making it challenging for them to leverage modern technologies and practices. The establishment of producer companies offers an organized platform for farmers, enhancing their socio-economic status. The very essence of these companies is to uplift farmers by orchestrating them into agricultural groups, further organized as producer companies.
Every member in a producer company has a singular voting right, irrespective of their capital contribution. Shares of such companies are exclusive to the members and are non-transferrable. Governance in these companies demands a minimum of five directors, but it shouldn't exceed fifteen. Notably, producer entities or a combo of two such entities can initiate a producer company.
Producer Companies are multifaceted, engaging in a plethora of activities:
Registering a producer company comes with a myriad of advantages:
Registration of a producer company mandates certain criteria:
A Producer Company emphasizes solely on equity share capital, marking its unique nature in the corporate world.