🔗 Share this article A Czech Wealthy Magnate Secures Prime Ministerial Post, Vowing to Sever Commercial Empire Andrej Babis's cabinet is set to be a clear departure from its firmly Ukraine-supporting forerunner. Entrepreneur Andrej Babis has been sworn in as the nation's new premier, with his government anticipated to be appointed in the coming days. His confirmation came after a fundamental stipulation from President Petr Pavel – a formal commitment by Babis to give up control over his vast food-processing, agriculture and chemicals group, Agrofert. "I vow to be a prime minister who champions the interests of every citizen, both locally and globally," affirmed Babis following the event at Prague Castle. "A prime minister who will work to transform the Czech Republic the finest location to live on the entire planet." Grand Visions and a Far-Reaching Corporate Footprint These are high-reaching aspirations, but Babis, 71, is accustomed to ambitious plans. Agrofert is so firmly entrenched in the Czech business landscape that there is even a specialized application to help shoppers bypass purchasing products made by the group's over two hundred subsidiaries. If a product – for example, frankfurters from Kostelecké uzeniny or packaged bread from Penam – is part of an Agrofert company, a thumbs-down symbol appears. Babis, who held the role of prime minister for four years until 2021, has adopted more right-leaning positions in recent years and his cabinet will include members of the right-wing SPD party and the Eurosceptic "Motorists for Themselves" party. The Pledge of Withdrawal If he upholds his pledge to divest from the company he founded and grew, he will no longer benefit from the sale of a single Agrofert product – ranging from processed meats to agricultural chemicals. As prime minister, he asserts he will have no insight of the conglomerate's financial health, nor any ability to sway its performance. State decisions on state contracts or subsidies – whether national or EU-funded – will be made without regard to a company he will no longer own or gain financially from, he adds. Instead, he proposes that Agrofert, worth an estimated $4.3bn (£3.3bn), will be transferred to a trust managed by an autonomous trustee, where it will stay until his death. Then, it will be inherited by his children. This arrangement, he remarked in a Facebook video, went "well above" the demands of Czech law. Outstanding Issues What kind of trust remains unclear – a Czech trust, or one in a foreign jurisdiction? The concept of a "fully independent trust" is not recognized in Czech statutory law, and an team of legal experts will be necessary to design an arrangement that is functional. Skepticism from Anti-Corruption Groups Skeptics, including Transparency International, continue to doubt. "A blind trust is an inadequate measure," argued David Kotora, the head of Transparency International's Czech branch, in an statement. "True separation is absent. He obviously knows the managers. He knows Agrofert's holdings. From an high office, even at a European level, he could possibly act in matters that would affect the industry in which Agrofert operates," Kotora cautioned. Wide-Ranging Interests Beyond Agrofert But it's not only food – and it's not just Agrofert. In the outskirts of Prague, a medical facility stands near the O2 arena. While it is owned by a company called FutureLife a.s, that company is controlled by Hartenberg Holding, and Hartenberg Holding is, in turn, majority-owned by Babis. Hartenberg also manages a chain of reproductive clinics, as well as a flower shop network, Flamengo, and an lingerie store chain, Astratex. The influence of Babis into multiple areas of Czech life is extensive. And as prime minister, for the second time, it is about to get more extensive.
Andrej Babis's cabinet is set to be a clear departure from its firmly Ukraine-supporting forerunner. Entrepreneur Andrej Babis has been sworn in as the nation's new premier, with his government anticipated to be appointed in the coming days. His confirmation came after a fundamental stipulation from President Petr Pavel – a formal commitment by Babis to give up control over his vast food-processing, agriculture and chemicals group, Agrofert. "I vow to be a prime minister who champions the interests of every citizen, both locally and globally," affirmed Babis following the event at Prague Castle. "A prime minister who will work to transform the Czech Republic the finest location to live on the entire planet." Grand Visions and a Far-Reaching Corporate Footprint These are high-reaching aspirations, but Babis, 71, is accustomed to ambitious plans. Agrofert is so firmly entrenched in the Czech business landscape that there is even a specialized application to help shoppers bypass purchasing products made by the group's over two hundred subsidiaries. If a product – for example, frankfurters from Kostelecké uzeniny or packaged bread from Penam – is part of an Agrofert company, a thumbs-down symbol appears. Babis, who held the role of prime minister for four years until 2021, has adopted more right-leaning positions in recent years and his cabinet will include members of the right-wing SPD party and the Eurosceptic "Motorists for Themselves" party. The Pledge of Withdrawal If he upholds his pledge to divest from the company he founded and grew, he will no longer benefit from the sale of a single Agrofert product – ranging from processed meats to agricultural chemicals. As prime minister, he asserts he will have no insight of the conglomerate's financial health, nor any ability to sway its performance. State decisions on state contracts or subsidies – whether national or EU-funded – will be made without regard to a company he will no longer own or gain financially from, he adds. Instead, he proposes that Agrofert, worth an estimated $4.3bn (£3.3bn), will be transferred to a trust managed by an autonomous trustee, where it will stay until his death. Then, it will be inherited by his children. This arrangement, he remarked in a Facebook video, went "well above" the demands of Czech law. Outstanding Issues What kind of trust remains unclear – a Czech trust, or one in a foreign jurisdiction? The concept of a "fully independent trust" is not recognized in Czech statutory law, and an team of legal experts will be necessary to design an arrangement that is functional. Skepticism from Anti-Corruption Groups Skeptics, including Transparency International, continue to doubt. "A blind trust is an inadequate measure," argued David Kotora, the head of Transparency International's Czech branch, in an statement. "True separation is absent. He obviously knows the managers. He knows Agrofert's holdings. From an high office, even at a European level, he could possibly act in matters that would affect the industry in which Agrofert operates," Kotora cautioned. Wide-Ranging Interests Beyond Agrofert But it's not only food – and it's not just Agrofert. In the outskirts of Prague, a medical facility stands near the O2 arena. While it is owned by a company called FutureLife a.s, that company is controlled by Hartenberg Holding, and Hartenberg Holding is, in turn, majority-owned by Babis. Hartenberg also manages a chain of reproductive clinics, as well as a flower shop network, Flamengo, and an lingerie store chain, Astratex. The influence of Babis into multiple areas of Czech life is extensive. And as prime minister, for the second time, it is about to get more extensive.