Key facts
- The European Commission has confirmed a potential conflict of interest for Czech Prime Minister Andrej Babiš regarding his former business, Agrofert.
- The Commission believes Babiš's trust fund arrangement does not sufficiently mitigate the conflict of interest.
- Brussels has frozen €3.18 million in reimbursements to the Czech state for farm subsidies paid to Agrofert.
- Agrofert maintains it has received subsidies in compliance with Czech and European law.
- Babiš has denied any wrongdoing and stated he does not own or benefit from Agrofert.
The European Commission has confirmed a potential conflict of interest for Czech Prime Minister Andrej Babiš concerning his former business, Agrofert, a large agro-chemical conglomerate and recipient of EU funds. The Commission stated that the trust fund Babiš established to avoid conflicts of interest does not sufficiently mitigate the situation, raising concerns about the protection of EU funds.
Brussels last month froze €3.18 million in reimbursements to the Czech state for farm subsidies paid out to Agrofert. This action followed an earlier May decision by the Commission not to reimburse any paid-out subsidies until doubts about Babiš's involvement in the business were resolved. The Commission's Directorate-General for Agriculture and Rural Development (DG AGRI) warned in a letter that Brussels would take all necessary steps to protect EU funds, including potential interruption or suspension of payments.
TI Czechia Executive Director David Kotora received the letter in September, and a follow-up letter dated October 5 granted the NGO permission to share its contents. Commission spokesperson Louise Bogey confirmed the letter was sent but declined to comment on its specific content, instead referring to earlier remarks stating Babiš was in a "potential conflict of interest."
Babiš has repeatedly denied any wrongdoing, stating he does not own or benefit from Agrofert. Agrofert spokesperson Pavel Heřmanský asserted that the letter from DG AGRI represents the opinion of one department and not the official stance of the European Commission, adding that only the Court of Justice of the European Union can provide a binding interpretation of EU law. Heřmanský also stated that Agrofert has received subsidies in compliance with both Czech and European law. Czechia's agricultural paying agency, which had previously deemed Agrofert eligible for subsidies despite the Commission's warning, has sent clarifications to the Commission.