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September 19, 2018 12:00 am | FILED UNDER: business

Transparency International Alerts Brussels Of Babis’s Conflict Of Interest

By ČTK Andrej Babis

Prague, Sept 19 (CTK) – The Transparency International (TI) organisation sent today its second motion concerning Czech Prime Minister Andrej Babis’s possible conflict of interest, this time to the European Commission (EC), today, TI has announced in its press release.

 

According to TI, billionaire businessman Babis (ANO chairman) is suspected of still controlling the giant Agrofert holding, including chemical, food-processing and agricultural firms and media outlets, which receives high EU subsidies.

 

Babis owned Agrofert until last year when he transferred it to trust funds to avoid conflict of interest.

 

TI wants the EC to look into Babis’s links to Agrofert.

 

The TI’s accusation of conflict of interest is nonsensical, Babis wrote to CTK today, adding that he had transferred Agrofert to the trust funds and was not dealing with the firm as he had no time for it.

 

As head of government, Babis is involved in the fulfilment of the EU budget and this is why it cannot be ruled out that he faces a conflict of interest, TI says in its press release.

 

Its letter is addressed to the European Commission directorates-general for regional policy and for agriculture.

 

Agrofert spokesman Karel Hanzelka has said the current situation is fully in harmony with the Czech law.

 

The EC must check the links between PM Babis and Agrofert and see to it that the valid measures against conflict of interest are met, TI EU director Carl Dolan said.

 

The TI’s second motion concerns a suspected violation of the EU regulations, under which the persons who participate in the budget fulfilment must avoid any behaviour leading to a conflict of their own and EU interests.

 

According to TI, an unbiased decision-making on the allocation of EU subsidies on a national level is threatened.

 

Moreover, a possible conflict of interest in the past when Babis was finance minister in the government of Bohuslav Sobotka (Social Democrats, CSSD) and at present as the PM cannot be ruled out.

 

In reaction to TI, Babis recalled that he transferred Agrofert to trust funds in 2017.

 

“TI has no evidence to prove my influencing of the firm. It cannot have any as nothing like that has been happening. I respect laws and I do not deal with my former company. I even have no time to do so. Mr Ondracka has been spreading this nonsense about me for long. He has thus become a part of political struggle,” Babis wrote to CTK, referring to David Ondracka, head of the Czech branch of TI.

 

TI is not independent because in the past, it drew money from the ministries then controlled by ANO’s rival parties, Babis wrote.

 

Hanzelka, for his part, points out that TI expediently refers to Slovak legal regulations that differ from the Czech ones.

 

“According to Czech law, Mr Babis is not the real owner [of Agrofert]. This is actually the administrator of the AB private trust I fund, Mr Zbynek Prusa,” Hanzelka added.

 

TI admits that Babis is really not the Agrofert owner formally, but it says he is in such a position in relation to the trust funds that enables him to control Agrofert directly or indirectly.

 

TI refers to information from the Slovak register of public sector partners, showing that the Slovak-born Babis figured as one of the five people controlling Agrofert companies.

 

Babis previously dismissed the TI statements as nonsense. He claims that he does not influence Agrofert anymore.

 

“This case has a European dimension. The PM’s conflict of interest is threatening the Czech Republic’s interests in the talks about the EU budget,” TI Czech Republic director CR David Ondracka said about the Babis case.

 

TI sent the first of its two motions concerning Babis’s suspicion of conflict of interest to the municipal office in Cernosice near Prague, under which Babis’s permanent residence falls, in August.

 

It concerned Babis’s conflict of interest connected with the media ownership.

 

If the office finds out that Babis violated law, he will face up to a 250,000-crown fine.

 

Josef Sedlacek, from the Cernosice local authority section of minor offences, told CTK that the proceedings on the TI motion had not been completed yet.

 

Agrofert owns the operators of the Ocko TV channel and Londa radio station as well as the Mafra publisher of periodicals, including the national dailies Lidove noviny and Mlada fronta Dnes.

 

TI reminds that the conflict of interest law bans the government members from owning firms operating TV and radio stations and publishing papers.

 

Agrofert, the largest agricultural, chemical and food-procession holding in the Czech Republic, employed 33,000 people, while 22,000 in the Czech Republic, and its consolidated profit was 4.8 billion crowns last year.

 

Last year, Agrofert received the record subsidies of 2.1 billion crowns, the financial paper Hospodarske noviny (HN) has reported.

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