Producing and distributing food – guidance

Become a producer organisation

Find out how you can set up a producer organisation (PO) as a group of growers.

If you are a group of growers wishing to operate as a PO, you must apply for PO recognition in the EU member state where most of your members are based or where you will sell most of your produce.

The PO will be expected to prove conclusively that it was formed on the initiative of the growers.

Applying for PO recognition

In England and Wales, POs are assessed and managed by the Rural Payments Agency (RPA). In Northern Ireland and Scotland, the Devolved Administration (DA) manages the process of PO recognition.

To seek recognition, you will need to complete National Strategy and its Environmental Framework (PDF, 952KB, 134 pages) . You can contact the RPA’s Customer Service Centre on: 03000 200 301 to ask for this application form.

Guidance on applications

No strict rules govern PO assessment, and either RPA or the relevant DA makes the ultimate decision on PO recognition.

However, a PO must show it is responsible for all of its products in terms of:

  • collecting
  • storing
  • packaging
  • marketing

POs must either provide actual facilities/services or be ultimately responsible for arranging their provision to all of its members, including future members.

You should contact the RPA or your relevant DA for further advice on applying for PO recognition. You will also find detailed advice on PO recognition in the Fruit and Veg Scheme Guidance (PDF, 676KB, 112 pages) .

Criteria for becoming a PO

The PO recognition assessment will check/reference the criteria set out in the [National Strategy and its Environmental Framework] National Strategy and its Environmental Framework (PDF, 952KB, 134 pages) .

Overall, POs must be able to withstand close scrutiny of their operation and management and clearly demonstrate that:

  • scheme expenditure/investments benefit all members on a fair basis
  • it has clear voting arrangements and evidence of democratic decision-making
  • its members benefit from the PO’s funds and capital investments and that benefit is not directly proportionate to the members’ contribution to the fund
  • if a number of closely related businesses have between them a shareholding dominance, evidence shows this does not constitute undue influence on PO activities

Application inspection visits

On receipt of an application for recognition, inspectors will visit the PO to check that the PO is carrying out the required activities such as:

  • collecting operating fund contributions in the correct manner
  • maintaining satisfactory records
  • not receiving duplicate funding, directly or indirectly
  • collecting enough contributions to cover the PO’s proportion of the previous years’ expenditure

Access must be given to inspection officers at all reasonable times. If a PO prevents an inspector from making a check, the application will be rejected.

Decisions on PO recognition

Following application and inspection, the PO will be told if its application is successful or not. Notification should be within three months of submitting a proposal.

Application deadline

Applications and supporting information needs to be submitted by 15 September (to commence on 1 January of the following year).

Full guidance on the application process is covered in Fruit and Veg Scheme Guidance (PDF, 676KB, 112 pages) .

Who can join a PO?

POs can be based across EU member states, but a PO’s head office must be in the member state where it has most of its holdings or members, and/or its highest level of produce for sale.

Members from non-EU countries

Members from countries outside of the EU may join a PO. However, turnover from such members won’t count towards the minimum eligible turnover for recognition, or fulfilling the minimum membership criteria. Similarly, such members cannot benefit from the operational programme.

Number of POs you can join

Where members have a number of different holdings, they may opt to be a member of a separate PO for each holding. Members must discuss this with their POs and the PO must tell the RPA or relevant DA if its members belong to more than one PO.

When can you join a PO?

You may join a PO at any point during the year. However your marketed production (produce available for sale) won’t count towards the PO’s marketed production until the following year.

Minimum membership period for producers

The minimum membership period of a PO is one year. However, POs are entitled to require a longer commitment to membership.

Details of this period must be included in the membership agreement.

Member resignations

Resignation of membership must be notified to the group in writing no later than 30 September, to take effect on 1 January of the following year.

POs are entitled to require a longer period of notice and details of this must be included in the membership agreement.

POs are required to inform the RPA or relevant DA, in writing, of the resignation of any PO member. POs will be requested to provide a copy of the resignation.