The Ministry for Regional Development (MMR) insists that it could not have acted otherwise when deciding not to pay subsidies for purchases from companies belonging to the Agrofert holding. The reason is the European Commission’s conclusion that former Prime Minister Andrej Babiš (ANO), whose trust funds Agrofert belongs to, was in a conflict of interest. A spokesman for the department said that the ministry must follow the conflict of interest law and the opinions of experts. Due to the non-payment of CZK 2.5 million, the Higher Vocational School and the Secondary School of Agriculture Benešov are planning to file an administrative lawsuit.
According to the statement of the spokesperson of the Central Bohemian Region, David Šíma, the ministry’s decision on non-payment of subsidies concerns five projects, and the contribution organizations of the region incurred a loss of CZK 24.76 million. According to the server iROZHLAS.cz, a similar situation exists in the Moravian-Silesian Region.
Non-reimbursement or enforcement of subsidies due to violations of the Act on Conflict of Interest concerns ten projects, said Petr Waleczko from the press department of the MMR when asked by ČTK. “So far, in only two cases has the recipient filed objections and is considering filing a lawsuit,” he added. So far, according to him, there is no relevant court decision that could serve as a precedent.
The resort states that by not paying subsidies or enforcing them, it responded to the final conclusion of the European Commission’s audit on the conflict of interests of ex-prime minister Babiš and also to available expert opinions. “These are European funds and the European Commission came to the conclusion that former Prime Minister Babiš was in a conflict of interest. The Ministry of Regional Development cannot act in these cases other than to follow the rules of the Act on Conflict of Interest and the opinions of experts,” said Waleczko.
According to the resort, this is nothing out of the ordinary. The Integrated Regional Operational Program (IROP) has already reduced subsidies in many hundreds of cases and resolved almost 600 objections to the reduction.
The Ministry states that it cooperates with all affected regions and from the beginning recommended to the regions the next possible course of action towards the supplier, who should not have applied for the tender at all due to the conflict of interests. “It must be emphasized that if the law on conflict of interests had been strictly observed under the previous government or if the ex-prime minister had renounced his ties to the Agrofert concern, the non-payment and enforcement of subsidies might not have happened,” added Waleczko.
Babiš’s possible conflict of interest has been talked about since he entered politics, and especially after his movement entered the House of Representatives in 2013 and Babiš took the seat of Minister of Finance in January 2014. Agrofert, of which he was then the owner, is the number one in the agricultural and food sector and the second most important group of the chemical industry in the Czech Republic. In February 2017, Babiš deposited Agrofert shares in trust funds. Agrofert Holding is convinced that its public contracts were in accordance with the law and all subsidy rules, said Agrofert spokesman Pavel Heřmanský.