Producer Company


A Producer Company is a Farmer’s Company. A producer company is a company incorporated by the farmers for their mutual benefits. The purpose of forming a Producer Company is to promote well-being of farmers and help them in their agricultural operations.

It must be noted that, though the Companies Act 1956 has been replaced with Companies Act 2013, a producer company is still governed by “Part IXA of Companies Act 1956: Producer Company” since there are no distinct provisions in Companies Act 2013. It was proposed that there will be a separate act for Producer Company but it has not been enacted yet. Hence Companies Act 1956 remains applicable to all producer companies.

Producer Company is like cooperatives of farmers to avail the benefits of a corporate entity registered under the Companies Act. As per the Companies Act 1956, a Producer Company my carry on all or any of the following activities:

  • Production
  • Procurement
  • Grading
  • Harvesting
  • Pooling
  • Marketing
  • Handling
  • Selling 
  • Import/Export of primary produce. 
A producer company can be a Private Limited company or Public Limited Company.

Steps of Incorporation of the Company

Name Availability

Check whether proposed name(s) do(es) not match with existing names of the companies.



For incorporation of Company and its further compliances Class 2 DSC is necessary.



File web based Form RUN for the purpose of reservation of name for the company



File web based forms Form SPICe+, Forms SPICe+ MOA, Forms SPICe+ AOA, Form AGILE Pro, and Form INC-9 for completion of incorporation process.



  • In case of Producer Company Form SPICe+ MOA and Form SPICe+ AOA are not applicable. They must be in printed form signed physically by its subscribers.
  • Objects of the producer company are fixed. They must be in accordance with “OBJECTS OF PRODUCER COMPANY” given in the Act.
  • Minimum number of subscribers in Producer Company must be 10 or more who are individuals and Farmers. Producer institutions can also become member or subscriber subject to compliance of the Act.
  • It is desirable to include words “Producer Company” or any such words in the name of the Producer Company which indicates that it is a producer company.

Membership and Voting Rights

  • Ten or more individuals as subscribers
  • In a case where all the members of the Producer Company are individual members, then the voting rights shall be based on a single vote for every member, irrespective of his shareholding or furtherance of the Producer Company.
  • In a case where the members of Producer Company are Producer institutions only, then the voting rights of such Producer institutions shall be determined based on their participation in the business of the Producer Company in the previous year, as may be specified by articles of association of Producer Company
  • But during the 1st year of registration of a Producer Company, the voting rights must be determined based on the shareholding by such Producer institutions
  • In a case where the members of Producer Company are individuals and Producer institutions, the voting rights must be computed based on a single vote for every member


  • Every producer company must have at least 5 Directors and a maximum of 15 Directors.
  • Director(s) may be appointed by members in AGM or EOGM as the case may be or by the Board of Directors of the company in its meeting as an Additional Director and regularize them in ensuing AGM.
  • Every person must hold the office of a Director for a minimum period of 1 year and a maximum period of 5 years as may be specified in the articles.
  • Every Director, who retires under the articles, shall be eligible for re-appointment as a director.
  • The board must have the following powers.

Annual General Meeting (AGM)

  • The first AGM of Producer Company must be conducted within 90 days from its incorporation.
  • A Producer Company is required to conduct an Annual General Meeting each year and, the gap between two AGMs must be less than or equals to 15 months.

Loans to Members

  • The Board may, subject to the provisions prescribed in articles, provide financial assistance to the Members of the Producer Company by way of –
  • Credit facility for a period not exceeding six months, to any Member, concerning the business of the Producer Company.
  • Loans and advances, against security as may be specified in articles to any Member, which is repayable within a period exceeding 3 months but not more than 7 years from the disbursement of such loan or advance: Provided that any loan or advance to any director or his relative shall be granted only after the approval by the Members in general meeting.

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