PRAGUE (Reuters) – Czech Prime Minister Andrej Babis and his business empire could be among the first cases examined by the European Union’s new joint prosecution after a referral to national authorities, a senior Czech prosecutor said on Wednesday.
Babis is a billionaire who transferred his conglomerate of companies Agrofert in the agricultural, chemical, food and other sectors – many of which receive EU grants – to trust funds, but an EU audit concluded that he still controlled the property.
The European Public Prosecutor’s Office (EPPO) launched its operation on June 1, led by Romania’s former anti-corruption chief prosecutor, Laura Koevesi, and is expected to take on serious cases involving European funds.
An EPPO investigation would be another headache for Babis who faces a difficult election campaign this summer and a separate prolonged criminal investigation in his country for alleged fraud of EU subsidies.
High Prosecutor Lenka Bradacova confirmed to Reuters that the case, overseen by her office, is being referred to the European Public Prosecutor’s Office.
“The criminal case (…) generally qualified as a conflict of interest of the Prime Minister, falls within the sphere of action of the newly created office (European Public Prosecutor’s Office) because of the description of the act and its legal qualification “she said.
Babis vigorously denied any wrongdoing and said he had met all legal requirements by moving Agrofert to trust funds. He blamed the opposition Pirate Party, which lodged the initial complaint, for pushing the case for political ends.
A Czech representative to the European Public Prosecutor’s Office also confirmed to Reuters that the case had been reported by Czech prosecutors for referral. A spokesperson for Babis had no comment available.
Agrofert was the largest recipient of EU Common Agricultural Policy (CAP) funds in 2018 and 2019, paid per hectare or per animal, at over € 29 million ($ 35.4 million) each year, according to an analysis by the CEPS think tank.
Babis companies have also received development grants from EU-backed project finance, which are normally approved by national authorities and later claimed for reimbursement in Brussels.
A European Commission audit published in April that focused on projects, not CAP payments, concluded that he was in a conflict of interest and should not have received the funds. The funds under review, worth several million euros, had not yet been repaid from the EU budget.
Babis is also the subject of a separate home criminal investigation for allegedly concealing the property of a company that developed a conference center outside of Prague to secure an EU grant of $ 2million. euros for small businesses.
($ 1 = 0.8189 euros)
Report by Robert Muller; Additional reporting by Jan Strupczewski in Brussels; written by Jan Lopatka; edited by Clélia Oziel