Czech billionaire PM Babis under scrutiny again as EU halts payments

PRAGUE, Sept 8 (Reuters) - The European Union has halted funding of some subsidy payments to the Czech Agrofert group, a conglomerate of firms that Prime Minister Andrej Babis moved to a trust fund to avoid a conflict of interest, the EU's executive Commission said on Tuesday.

Babis set up the fund after returning to the post of prime minister in December 2025, saying the arrangement met all requirements to avoid mixing political and business interests.

The Commission said he had not sufficiently severed his ties with the conglomerate.

"The Commission... considers that the Czech prime minister is in a potential situation of conflict of interest in relation to the management of a cohesion policy and agricultural funds," a spokesperson told a briefing. 

"The trust fund set up by Mr. Babis does not sufficiently mitigate this situation."

Agrofert includes hundreds of firms in farming, chemicals and other industries, and has been receiving millions of euros in EU payments to farmers as well as other support.

The spokesperson said the EU decision did not apply to direct payments allocated automatically to farmers.

Agrofert is the top Czech farm company with about 130,000 hectares under management.

Babis shrugged off the EU decision.

"I do not own Agrofert, I will never own it again and I do not have any benefit from it," news agency CTK quoted him as saying. 

The Czech farm aid administrator SZIF said on Monday that the Commission had interrupted payments of €3 million, pending further investigation. 

Agrofert, which is also a major European fertilizer producer, said it was meeting all legal requirements.

Babis still owns hundreds of millions of euros worth of businesses outside Agrofert, including health clinics around Europe.

An EU audit previously found Babis in conflict of interest during his previous term in 2017-2021.

(Reporting by Jan Lopatka;Editing by Gareth Jones)