Former PM Babiš charged with fraud over Čapí hnízdo EU subsidy

Babiš has denied any wrongdoing in accepting CZK 50 million in EU funds meant for small or medium-sized businesses.


Written by ČTK Published on 21.03.2022 14:48:00 (updated on 21.03.2022) Reading time: 4 minutes

Prague, March 21 (ČTK) – Former Prime Minister Andrej Babiš and his former aide Jana Nagyová have been charged with fraud over the granting of a CZK 50 million EU subsidy to the Čapí hnízdo farm and conference center in 2008. The Prague Municipal Court will now deal with the case.

Politicians for the current coalition government said they welcomed the prosecutor's decision and that Babiš would have the chance to explain his side of the case in court.

Babiš, who denies any wrongdoing, says the Čapí hnízdo (Stork Nest) case was fabricated to force him out of politics. Nagyová has also denied any guilt in the matter. Babiš is one of the richest people in the Czech Republic. His money comes from the food and chemical conglomerate Agrofert, though he also has holdings in media and other sectors.

“The public prosecutor of the Prague Metropolitan Public Prosecutor’s Office brought charges against two individuals on March 21, 2022, in a matter dubbed by the media as the Čapí hnízdo case," office spokesman Aleš Cimbala told the Czech News Agency (ČTK).

One person is charged with subsidy fraud and harming EU financial interests, and the other with assisting in subsidy fraud, he added, without naming specific names.

Babiš confirmed to news sever iDnes that he and Nagyová were the ones being charged. “Today, it has only been confirmed that this is a contrived political process against me,” he said. The iDnes portal is part of Babiš's media holdings thought Agrofert.

Čapí hnízdo convention center. Photo: Wikimedia commons, CC BY-SA 3.0.
Čapí hnízdo convention center. Photo: Wikimedia commons, CC BY-SA 3.0.

Originally, 11 people were to be prosecuted, including members of Babiš's family. Public Prosecutor Jaroslav Šaroch gradually halted all the prosecutions, but then–Prosecutor General Pavel Zeman in late 2019 called for prosecutions of Babiš and Nagyová to be resumed. At the same time, he confirmed that the prosecution of the others had been definitively stopped.

The police originally ended the investigation into the case last May and proposed that Babiš and Nagyová be charged. Last August, Šaroch returned the case to the police for further investigation including the further questioning of witnesses, mainly Babiš's son, Andrej Babiš Jr., who testified in the case.

In September, police again proposed that Babiš and Nagyová should face charges.

The investigation was delayed after Babiš regained his mandate as a deputy in the Chamber of Deputies, the lower house of Czech Parliament, in the October election. This extended his immunity from prosecution. The new Chamber of Deputies in early March ended his immunity, making him available for criminal prosecution.

Cimbala said there was no choice but to bring charges. “The public prosecutor is bound by the law and the accusatorial principle. The legal conditions which the criminal order defines for filing charges were fulfilled in this matter. The respective court will have to deal with possible doubts,” Cimbala said.

The case centers on the Farma Čapí hnízdo company, formerly under the name ZZN Agro Pelhřimov, which was originally part of Babiš's Agrofert holding. In December 2007, Čapí hnízdo became a joint-stock company with bearer shares. In the summer of 2008, it received a CZK 50 million subsidy from the EU intended to help small and medium-sized businesses.

The company would not have qualified for the subsidy if it had still been part of the Agrofert group. After a couple of years of observing the subsidy conditions, Čapí hnízdo returned to being part of Agrofert.

Agrofert is now divided into two trust funds. While Finance Minister in 2017, Babiš placed the company in a trust fund to comply with a new conflict of interest law.

Current Prime Minister Petr Fiala (ODS) urged people to let justice take its course. “I will not comment on the ongoing proceedings, I trust the independent courts,” he said. He added that it would be good for everyone when the case is finally over.

Deputy Prime Minister and Interior Minister Vít Rakušan (STAN) told ČTK that he considered this a first step leading towards a valid verdict in the Čapí hnízdo case.

“The Chamber of Deputies has sent a clear signal that it is up to the court to decide on guilt or innocence. I consider this the first step towards bringing this case, which has long burdened the Czech Republic, to a valid decision,” Rakušan said.

Chamber of Deputies and TOP 09 chairwoman Markéta Pekarová Adamová on Twitter said that the time for talk and investigation was over. “If [Babiš] had any self-reflection, he would resign from all positions and he would not run for office anywhere until the decision,” she said.

Pirates chairman Ivan Bartoš said that Babiš would finally get a chance to clarify the case in court.

“Like any other citizen of this country, Andrej Babiš will get a chance to defend himself and his deeds before an independent and just court. Any other comments by politicians on this issue are useless for the time being,” Bartoš said.

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