Farmer Producer Company Registration

Farmer Producer Company (FPC) or Farmer Producer Organization (FPO) is an organization that has been designed taking into consideration the requirements of farmers, agriculturists, fishermen, weavers, milk producers, and persons engaged in farming activities, collectively known as ‘Producers’.

The main intention of the Farmer Producer Company is to ensure better income for the producers through an organization of their own as the small producers do not have the volume of inputs to get the benefit of agricultural produce on large scale. Additionally, in agricultural marketing, there is a long chain of intermediaries, through which the producers receive only a small part of the value that the ultimate consumer pays. On the other hand, in the Farmer Producer Company, the producers have better bargaining power, bulk buyers of the produce, and bulk suppliers of inputs. Therefore, a Producer Company deals primarily with agriculture and post-harvest processing activities on a larger scale.

Farmer Producer Company is a company registered under the Companies Act, 2013, which has the objective of production, harvesting, procurement, grading, pooling, handling, marketing, selling, and export of primary produce of the Members or import of goods or services for their benefit. Here, produce are those things that have been produced or grown by farming and allied activities. A person being a “producer” or any “producer institution” can be admitted as a member of the Producer Company.

Advantages Of Farmer Producer Company Registration

• Separate legal entity

The Producer Company is registered as per the procedure of law, and therefore, it is known as a separate artificial person in the eyes of law. Further, the Producer Company is deemed to be a Private Limited Company through which the liability of each member or shareholder is limited up to the unpaid amount of shares. It means that if a company faces loss under any circumstances, then its shareholders are not liable to sell their own assets for payment. Thus, the personal, individual assets of the shareholders are not at risk.

• No minimum capital required

After the Companies Amendment Act 2017, the requirement of minimum capital for a Producer Company was abolished. So now a Producer Company can be formed even with minimum capital (Ex. Rs.10,000)

•  Higher Credibility

Farmer Producer Company is registered under the Companies Act 2013 with the Ministry of Corporate Affairs (MCA) and therefore is eligible to carry out the business operation in the entire country which gives the flexibility to expand business in a free and professional manner. Further, it is also required to conduct the annual general meeting, have its accounts audited, and appoint a full-time CEO which gives the Producer Company higher credibility and transparency among members and the general public. 

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