🔗 Share this article A Czech Tycoon Secures PM Office, Pledging to Disentangle Corporate Holdings The incoming government is set to be a distinct shift from its firmly Ukraine-supporting previous government. Wealthy businessman Andrej Babis has officially become the Czech Republic's new premier, with his complete ministerial team anticipated to be appointed in the coming days. His confirmation followed a fundamental condition from President Petr Pavel – a official assurance by Babis to give up oversight over his sprawling agribusiness and chemical conglomerate, Agrofert. "I commit to be a prime minister who defends the interests of every citizen, both locally and globally," declared Babis following the event at Prague Castle. "A leader who will work to establish the Czech Republic the finest location to live on the face of the Earth." Grand Visions and a Vast Business Presence These are grandiose goals, but Babis, 71, is used to thinking big. Agrofert is so thoroughly integrated in the Czech commercial ecosystem that there is even a specialized application to help shoppers bypass purchasing products made by the group's more than 200 subsidiaries. If a product – for example, Viennese-style sausages from Kostelecké uzeniny or packaged bread from Penam – falls under an Agrofert company, a thumbs-down symbol appears. Babis, who previously served as prime minister for four years until 2021, has shifted to the right in recent years and his cabinet will include members of the right-wing SPD party and the Eurosceptic "Motorists for Themselves" party. The Commitment of Separation If he fulfills his vow to divest from the company he established, he will stop gaining from the sale of any Agrofert product – from frankfurters to fertiliser. As prime minister, he claims he will have no knowledge of the conglomerate's fiscal condition, nor any ability to sway its performance. Administrative decisions on public tenders or subsidies – whether national or EU-funded – will be made without regard to a company he will have severed ties with or gain financially from, he further notes. Instead, he says that Agrofert, worth an estimated $4.3bn (£3.3bn), will be placed in a trust managed by an independent administrator, where it will remain until his death. At that point, it will be inherited by his children. This arrangement, he commented in a online address, went "well above" the requirements of Czech law. Clarification Needed The specific type of trust remains unclear – a trust under Czech law, or one in a foreign jurisdiction? The notion of a "fully independent trust" is not recognized in Czech legislation, and an army of lawyers will be needed to craft an arrangement that works. Criticism from Anti-Corruption Groups Watchdog organizations, including Transparency International, are still skeptical. "A blind trust is not the answer," argued David Kotora, the head of Transparency International's Czech branch, in an statement. "There's no separation. [Babis] is familiar with the managers. He knows Agrofert's range of businesses. From an high office, even at a EU level, he could potentially influence in matters that would impact the sector in which Agrofert functions," Kotora cautioned. Broad Reach Extending Past Agrofert But it's not just food – and it's not only Agrofert. In the outskirts of Prague, a private health clinic stands near the O2 arena. While it is the property of 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 network of fertility centers, as well as a florist chain, Flamengo, and an underwear retailer, Astratex. The footprint of Babis into all corners of Czech life is broad. And as prime minister, for the second occasion, it is poised to become broader.
The incoming government is set to be a distinct shift from its firmly Ukraine-supporting previous government. Wealthy businessman Andrej Babis has officially become the Czech Republic's new premier, with his complete ministerial team anticipated to be appointed in the coming days. His confirmation followed a fundamental condition from President Petr Pavel – a official assurance by Babis to give up oversight over his sprawling agribusiness and chemical conglomerate, Agrofert. "I commit to be a prime minister who defends the interests of every citizen, both locally and globally," declared Babis following the event at Prague Castle. "A leader who will work to establish the Czech Republic the finest location to live on the face of the Earth." Grand Visions and a Vast Business Presence These are grandiose goals, but Babis, 71, is used to thinking big. Agrofert is so thoroughly integrated in the Czech commercial ecosystem that there is even a specialized application to help shoppers bypass purchasing products made by the group's more than 200 subsidiaries. If a product – for example, Viennese-style sausages from Kostelecké uzeniny or packaged bread from Penam – falls under an Agrofert company, a thumbs-down symbol appears. Babis, who previously served as prime minister for four years until 2021, has shifted to the right in recent years and his cabinet will include members of the right-wing SPD party and the Eurosceptic "Motorists for Themselves" party. The Commitment of Separation If he fulfills his vow to divest from the company he established, he will stop gaining from the sale of any Agrofert product – from frankfurters to fertiliser. As prime minister, he claims he will have no knowledge of the conglomerate's fiscal condition, nor any ability to sway its performance. Administrative decisions on public tenders or subsidies – whether national or EU-funded – will be made without regard to a company he will have severed ties with or gain financially from, he further notes. Instead, he says that Agrofert, worth an estimated $4.3bn (£3.3bn), will be placed in a trust managed by an independent administrator, where it will remain until his death. At that point, it will be inherited by his children. This arrangement, he commented in a online address, went "well above" the requirements of Czech law. Clarification Needed The specific type of trust remains unclear – a trust under Czech law, or one in a foreign jurisdiction? The notion of a "fully independent trust" is not recognized in Czech legislation, and an army of lawyers will be needed to craft an arrangement that works. Criticism from Anti-Corruption Groups Watchdog organizations, including Transparency International, are still skeptical. "A blind trust is not the answer," argued David Kotora, the head of Transparency International's Czech branch, in an statement. "There's no separation. [Babis] is familiar with the managers. He knows Agrofert's range of businesses. From an high office, even at a EU level, he could potentially influence in matters that would impact the sector in which Agrofert functions," Kotora cautioned. Broad Reach Extending Past Agrofert But it's not just food – and it's not only Agrofert. In the outskirts of Prague, a private health clinic stands near the O2 arena. While it is the property of 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 network of fertility centers, as well as a florist chain, Flamengo, and an underwear retailer, Astratex. The footprint of Babis into all corners of Czech life is broad. And as prime minister, for the second occasion, it is poised to become broader.