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Central Europe
September 1, 2017 www.intellinews.com I Page 9
Czech populist election frontrunner embroiled in new scandal
bne IntelliNews
The Czech Republic’s likely next premier has become embroiled in another scandal after an audio tape was published on August 27 in which he allegedly described how he used the finance ministry to destroy a business enemy.
Andrej Babis, billionaire owner of the Agrofert agrochemicals group and leader of the populist Ano party, has refused to comment on the one- minute tape directly. However, he insisted that when he controlled the finance ministry the Fi- nancial Administration department was independ- ent and it was perfectly legitimate for it to pursue a tax probe into the FAU Prerov company. “I sup- pose Financial Administration had a clear reason to secure some of the money," he told Czech media.
But the recording was immediately leapt on by Prime Minister Bohuslav Sobotka, whose Social Democrats rule in coalition with Ano, and by op- position politicians as more evidence of the busi- nessman’s conflicts of interest and in particular his misuse of the ministry to benefit his companies.
Earlier this year the ruling Social Democrats and the opposition combined to pass a conflict of interests law, now before the Consitutional Court, that was dubbed the "Lex Babis" because it was clearly written to target Babis.
Rightwing opposition parties have also mounted
a campaign against the finance ministry’s tougher tax probes, which they argue have harmed small businesses and have sometimes been directed against Babis’ business rivals.
Andrej Babis, billionaire owner of the Agrofert agrochemicals group, has refused to comment on the tape.
On the tape, a voice similar to Babis’s is heard saying “our people kneeled on FAU Prerov” and that “it is in bankruptcy, and its accounts and railcars have been frozen”.
FAU Prerov – which has a fuel depot at the site of Agrofert’s industrial chemicals wholesaler Pre- cheza which Agrofert had allegedly previously tried to buy – was declared insolvent last year after the finance ministry’s tax office issued a seizure order. A court later found the order was illegal.
Agrofert has denied any interest in buying the fuel depot, which, following FAU Prerov’s insolvency, is likely to be put up for sale.
The prime minister, who sacked Babis over his alleged conflicts of interest in May, said on August 28 that the finance ministry must investigate the case within 30 days.
“I will also ask him to check whether the Treasury Department has interfered in any way, in violation of its competencies, with the tax administration," said Sobotka.
"I think the whole thing has to be scrutinised, it has to be checked and I expect the Treasury to provide all the necessary information within 30 days," he added.
However, a spokesman for Babis’ successor at the ministry, Ivan Pilny, who was nominated by the Ano leader, said the FAU Prerov case was now before the Supreme Administrative Court and therefore it would not intervene.