1st Oct 2023

MEPs call for action in Czech PM conflict-of-interest case

  • Andrej Babiš claimed the EU audit was 'manipulated' by his political foes

MEPs on Wednesday (19 May) called for the EU Commission and member states to take action over the conflict-of-interest case involving Czech prime minister Andrej Babiš.

Last month, the commission published an audit into subsidies granted to the Agrofert business empire, founded by Babiš and still controlled by him - despite Babiš having put his assets into trust funds when he became PM.

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  • Budget commissioner Johannes Hahn said the EU budget had been protected (Photo: European Parliament)

The audit found that Babiš is in violation of the EU's conflict-of-interest rules, as Agrofert has benefitted from EU funds.

Babiš rejected the findings, claiming the audit was "manipulated" by his political foes.

During the debate, budget commissioner Johannes Hahn told MEPs that that "no expenditure was so far declared for any of the operations affected by this audit", and said that the EU budget "has been and remains fully protected".

Hahn said the Czech authorities have implemented the majority of the audit's recommendations to prevent conflicts of interest.

The audit concerned the EU's regional development and the social fund.

However, Hahn said a separate audit procedure concerning funds for agricultural subsidies is still ongoing, and that dialogue continues with Prague on "corrective measures" and financial consequences.

The commissioner said reimbursements from the agriculture fund, for rural development requested by Czech authorities for the projects concerned, were suspended. Czech authorities last year challenged the suspension decision at the EU's top court.

German MEP Monika Hohlmeier, chair of the budget control committee which has been looking into Babiš's conflicts of interest for years, said the case has political and legal implications.

"It is unacceptable to what extent oligarchic structures in the Czech Republic have been developed, have settled, and which are actively engaged in continuing to get rich from EU funds," she warned.

"What I don't understand is that within council [of member states] this issue, which keeps coming up with respect [to] certain member states, is not dealt with clear legal arrangements," Hohlmeier added.

"The commission proceedings need to be swifter and better," the centre-right politician added.

"The commission and the council should act now. Are they willing to tolerate this 'oligarch-isation' of a member state, where the prime minister and his Agrofret group capture part of the Czech state and its institutions?," she said.

'Blind eye'

Several MEPs called for the commission to launch the mechanism suspending EU funds for breaching the rule of law against Prague, and also argued Babiš should not have been able to participate in EU budget talks.

Centre-right Czech MEP Tomáš Zdechovský argued the issue was about democracy, freedom and human rights, and said the EU has been turning a "blind eye to this conflict of interest".

Zdechovský and his family have received death threats for speaking out against the Czech prime minister.

'It is not about if I stay alive or not, after me, someone else will take the baton, and fight for democracy and freedom, we cannot be silenced," he told fellow MEPs.

The parliament plans to adopt a resolution on the matter in June.

The debate came after the Czech chief prosecutor Pavel Zeman, who ordered the reopening of a fraud investigation against the billionaire Babiš, said last Friday (14 May) he will resign in June due to conflicts with the country's justice minister.

The investigation is still ongoing.

Five Czech opposition parties plan a no-confidence vote in June against Babiš's government, ahead of elections in October.

Renew under fire

During the debate, some MEPs also levelled criticism at the liberal Renew Europe group, which is home to Babis's ANO party and has been reluctant to criticise the Czech PM.

German social democrat and vice-president of the European Parliament, Katarina Barley said she is "disappointed" with Renew, saying their arguments in the debate were "not worthy of a group that usually upholds the rule of law".

Czech MEP Ondřej Knotek from Renew group earlier said the commission and the Czech Republic will find a "positive solution".

"It was said that there is no risk to the EU budget, some of you don't want to see this ... for political reasons," he added.

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