Czech Republic's Populist Prime Minister-Elect Refuses to Divest Business Empire During Ethical Row

Andrej Babiš, the self-styled tycoon that won the recent parliamentary vote, has declined to sell his vast business interests, while asserting he will resolve a ethical dilemma that could block him from assuming the role of head of government.

Stance on Corporate Empire

Babiš, whose political movement emerged victorious in the October election but did not secure a majority in parliament, stated in a social media post that he will not divest his Agrofert group, which operates in farming, food production, and chemical industries.

“I have consistently said I will not sell Agrofert. I have repeatedly said I will address the conflict of interest in accordance with national and European laws,” the billionaire remarked. “This is different from selling a roll in a bakery.”

Head of State's Requirement

The head of state, Petr Pavel, stated that the 71-year-old populist must clarify openly how he will eliminate ethical conflicts arising from his corporate dealings before being appointed prime minister.

The Czech constitution “explicitly requires the president to consider the possible emergence of a ethical issue and the possibilities for its resolution” when appointing cabinet members, Pavel's office noted.

The head of state “expects clarity in what precise manner Andrej Babiš will meet his constitutional and legal obligations”, the announcement said, noting that Pavel was ready to appoint Babiš as premier “without delay” once the matter was resolved.

Corporate Activities and Legal Concerns

Babiš's numerous firms, mostly under the Agrofert group, operate in the nation and other central European states, receiving millions of euros in national and EU farming and other subsidies, as well as government deals.

Under national legislation, government ministers cannot receiving public aid or agreements. The ethics organization Transparency International has stated that to avoid a ethical breach, Babiš must either sell, decline government deals, or not enter government.

Previous Term and Current Intentions

Babiš affirmed he would “follow the laws” if selected as premier, but did not want to detail how in beforehand because the matter was “an extremely sensitive and personal matter for me, and journalists will always question me regardless”.

During his first term as premier, from 2017 to 2021, Babiš encountered several legal battles and an EU investigation over possible ethical issues. He temporarily moved his assets into trust funds, while keeping certain control over them.

A judicial body and the European Commission both ruled that this did not suffice. Babiš confirmed last month that he was again the exclusive proprietor of Agrofert and insisted he was “taking steps” to avoid a ethical problem, but declined to reveal specifics.

Governing Agreement and Foreign Policy Consequences

The wealthy politician has signed a governing pact with two minor right-leaning groups, the ultra-conservative, Russia-friendly SPD, which has called for a public vote on leaving the EU, and the Motorists for Themselves, which has primarily campaigned against the EU’s environmental policy.

The new government, if confirmed, is likely to bolster the populist movement in the region and might challenge backing from Western nations for Ukraine – although Babiš has contacted Ukraine’s leader, Volodymyr Zelenskyy, to confirm of the nation's backing.

Pavel, who as president shares responsibility for international relations, also demanded that the government agenda include a statement on the government’s position on Russia’s war in Ukraine, including a commitment to meeting alliance duties.

The president has earlier stated he would not approve any ministerial nominees who might doubt the nation's international alliances, a condition that the far-right SPD has indicated it will satisfy by nominating independent technocrats.