The European Parliament believes that Czech Prime Minister Babis should no longer be allowed to participate in decision-making on budgets and subsidies during EU meetings, as long as his own agricultural companies are receiving tens of millions in EU agricultural subsidies. This effectively places the Czech head of government under guardianship.
A European investigation has been ongoing for more than a year concerning the way EU subsidies in the Czech Republic primarily benefit companies owned by Babis and his business partners. The European Parliament is pressing for a public blacklist of fraudsters and abusers to be created. In recent years, whistleblowers and anti-fraud investigators have exposed more cases of EU subsidy abuse. To tackle fraud more effectively, it was also decided on Friday to establish a full-fledged parliamentary committee on Tax Payments.
In a resolution adopted on Friday with 510 votes in favor, 53 against, and 101 abstentions, the European Parliament regrets that the Czech prime minister remains actively involved in the EU budget while still controlling “Agrofert,” one of the largest beneficiaries of EU subsidies in the Czech Republic.
Although an EU investigation is still ongoing, Members of the European Parliament insist that suspicious politicians must choose among three possible solutions. They can relinquish their business interests, refrain from applying for EU funding, or abstain from decisions involving their own interests, including ultimately stepping down. MEPs are urging the European Commission to draft stricter rules, such as a maximum amount per person, and to publish the names of recipients.
The European Parliament also condemns the way Prime Minister Babis and his party officials have reacted against Czech MEPs who participated last year in the investigative mission into the reported irregularities in the management of EU funds. These MEPs have been more or less threatened.
The formal investigation by the European Commission into the conflict of interest of the Czech prime minister has been ongoing since January 2019. At the end of last year, all payments from the EU budget to companies of Prime Minister Babiš were suspended. In December 2019, the Czech Attorney General reopened the investigation into the misuse of EU funds by one of the sub-projects of the Agrofert group, “Stork Nest.” The investigation was initially launched following the report of the EU anti-fraud watchdog OLAF.
Agrofert is a conglomerate of more than 230 companies with over 34,000 employees. Prime Minister Babiš founded the Agrofert Group and is reportedly still the ultimate beneficiary. The group was one of the largest recipients of EU subsidies: Members of the European Parliament state that the group alone received approximately 36.5 million euros in agricultural subsidies for 2018, plus an additional 16 million euros from the Cohesion Fund. Currently, no EU legislation requires a member state to disclose the ultimate beneficiaries of EU subsidies.