🔗 Share this article A Czech Billionaire Takes Prime Ministerial Post, Vowing to Disentangle Commercial Empire The incoming cabinet represents markedly different from its firmly Ukraine-supporting forerunner. Wealthy businessman Andrej Babis has officially become the Czech Republic's new prime minister, with his complete ministerial team slated to assume their roles in the coming days. His appointment was contingent upon a key demand from President Petr Pavel – a official commitment by Babis to give up control over his vast agribusiness and chemical conglomerate, Agrofert. "I vow to be a prime minister who upholds the interests of every citizen, domestically and internationally," stated Babis after the swearing-in at Prague Castle. "A prime minister who will work to transform the Czech Republic the top destination to live on the whole globe." Grand Visions and a Pervasive Business Presence These are lofty ambitions, but Babis, 71, is accustomed to large-scale thinking. Agrofert is so firmly entrenched in the Czech commercial ecosystem that there is even a dedicated app to help shoppers bypass purchasing products made by the group's numerous 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 held the role of prime minister for four years until 2021, has moved rightward in recent years and his cabinet will incorporate members of the far-right SPD and the EU-skeptical "Motorists for Themselves" party. The Commitment of Divestment If he fulfills his vow to withdraw from the company he established, he will no longer benefit from the sale of any Agrofert product – ranging from processed meats to agricultural chemicals. As prime minister, he claims he will have no insight of the conglomerate's economic status, nor any power to affect its prospects. Governmental decisions on government procurement or subsidies – whether national or EU-funded – will be made without regard to a company he will have relinquished ownership of or gain financially from, he further notes. Instead, he proposes that Agrofert, worth an estimated $4.3bn (£3.3bn), will be placed in a trust managed by an third-party manager, where it will remain until his death. Upon that event, it will pass to his children. This arrangement, he remarked in a Facebook video, went "exceeded" the demands of Czech law. Clarification Needed The specific type of trust is still uncertain – a trust under Czech law, or one in a foreign jurisdiction? The legal framework of a "blind trust" is not recognized in Czech statutory law, and an battalion of attorneys will be required to design an structure that is legally sound. Criticism from Anti-Corruption Groups Watchdog organizations, including Transparency International, remain unconvinced. "Such a trust is not the answer," said David Kotora, the head of Transparency International's Czech branch, in an comment. "The divide is insufficient. [Babis] obviously knows the managers. He knows Agrofert's range of businesses. From an high office, even at a European level, he could possibly act in matters that would impact the industry in which Agrofert functions," Kotora warned. Broad Reach Beyond Agrofert But it's not just food – and it's not only Agrofert. In the outskirts of Prague, a medical facility 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, controlled by Babis. Hartenberg also runs a chain of reproductive clinics, as well as a florist chain, Flamengo, and an lingerie store chain, Astratex. The influence of Babis into all corners of Czech life is broad. And as prime minister, for the second occasion, it is set to grow even wider.
The incoming cabinet represents markedly different from its firmly Ukraine-supporting forerunner. Wealthy businessman Andrej Babis has officially become the Czech Republic's new prime minister, with his complete ministerial team slated to assume their roles in the coming days. His appointment was contingent upon a key demand from President Petr Pavel – a official commitment by Babis to give up control over his vast agribusiness and chemical conglomerate, Agrofert. "I vow to be a prime minister who upholds the interests of every citizen, domestically and internationally," stated Babis after the swearing-in at Prague Castle. "A prime minister who will work to transform the Czech Republic the top destination to live on the whole globe." Grand Visions and a Pervasive Business Presence These are lofty ambitions, but Babis, 71, is accustomed to large-scale thinking. Agrofert is so firmly entrenched in the Czech commercial ecosystem that there is even a dedicated app to help shoppers bypass purchasing products made by the group's numerous 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 held the role of prime minister for four years until 2021, has moved rightward in recent years and his cabinet will incorporate members of the far-right SPD and the EU-skeptical "Motorists for Themselves" party. The Commitment of Divestment If he fulfills his vow to withdraw from the company he established, he will no longer benefit from the sale of any Agrofert product – ranging from processed meats to agricultural chemicals. As prime minister, he claims he will have no insight of the conglomerate's economic status, nor any power to affect its prospects. Governmental decisions on government procurement or subsidies – whether national or EU-funded – will be made without regard to a company he will have relinquished ownership of or gain financially from, he further notes. Instead, he proposes that Agrofert, worth an estimated $4.3bn (£3.3bn), will be placed in a trust managed by an third-party manager, where it will remain until his death. Upon that event, it will pass to his children. This arrangement, he remarked in a Facebook video, went "exceeded" the demands of Czech law. Clarification Needed The specific type of trust is still uncertain – a trust under Czech law, or one in a foreign jurisdiction? The legal framework of a "blind trust" is not recognized in Czech statutory law, and an battalion of attorneys will be required to design an structure that is legally sound. Criticism from Anti-Corruption Groups Watchdog organizations, including Transparency International, remain unconvinced. "Such a trust is not the answer," said David Kotora, the head of Transparency International's Czech branch, in an comment. "The divide is insufficient. [Babis] obviously knows the managers. He knows Agrofert's range of businesses. From an high office, even at a European level, he could possibly act in matters that would impact the industry in which Agrofert functions," Kotora warned. Broad Reach Beyond Agrofert But it's not just food – and it's not only Agrofert. In the outskirts of Prague, a medical facility 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, controlled by Babis. Hartenberg also runs a chain of reproductive clinics, as well as a florist chain, Flamengo, and an lingerie store chain, Astratex. The influence of Babis into all corners of Czech life is broad. And as prime minister, for the second occasion, it is set to grow even wider.