🔗 Share this article A Czech Tycoon Takes Prime Ministerial Office, Promising to Sever Business Holdings The incoming cabinet will be markedly different from its firmly Ukraine-supporting previous government. Wealthy businessman Andrej Babis has been sworn in as the nation's new premier, with his full cabinet expected to be appointed within days. His selection came after a fundamental stipulation from President Petr Pavel – a formal assurance by Babis to give up control over his extensive agribusiness and chemical holding company, Agrofert. "I vow to be a prime minister who upholds the interests of every citizen, both locally and globally," declared Babis following the event at Prague Castle. "A leader who will work to transform the Czech Republic the finest location to live on the whole globe." High Aspirations and a Pervasive Business Presence These are grandiose goals, but Babis, 71, is familiar with large-scale thinking. Agrofert is so thoroughly integrated in the Czech economic fabric that there is even a specialized application to help shoppers steer clear of 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 – belongs to an Agrofert company, a warning symbol appears. Babis, who previously served as prime minister for four years until 2021, has moved rightward in recent years and his cabinet will feature members of the far-right SPD and the Eurosceptic "Drivers for Themselves" party. The Promise of Withdrawal If he honors his pledge to withdraw from the company he established, he will stop gaining from the sale of a single Agrofert product – ranging from processed meats to agricultural chemicals. As prime minister, he states he will have no information of the conglomerate's economic status, nor any ability to affect its prospects. Administrative decisions on public tenders or subsidies – whether Czech or European – will be made with no consideration for a company he will have severed ties with or profit from, he emphasizes. Instead, he explains that Agrofert, valued at $4.3bn (£3.3bn), will be transferred to a trust managed by an autonomous trustee, where it will remain until his death. Then, it will be inherited by his children. This arrangement, he remarked in a Facebook video, went "exceeded" the requirements of Czech law. Unanswered Questions What kind of trust has yet to be clarified – a trust under Czech law, or one in a foreign jurisdiction? The legal framework of a "blind trust" has no basis in Czech statutory law, and an team of legal experts will be needed to craft an solution that is legally sound. Doubts from Observers Critics, including Transparency International, remain unconvinced. "A blind trust is an inadequate measure," argued David Kotora, the head of Transparency International's Czech branch, in an statement. "The divide is insufficient. He is familiar with the managers. He knows Agrofert's portfolio. From an high office, even at a European level, he could possibly act in matters that would impact the sector in which Agrofert operates," Kotora warned. Wide-Ranging Interests Extending Past Agrofert But it's not only food – and it's not just Agrofert. In the eastern suburbs of Prague, a medical facility towers over the O2 arena. While it is the property of a company called FutureLife a.s, that company is majority-owned 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 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 about to get even wider.
The incoming cabinet will be markedly different from its firmly Ukraine-supporting previous government. Wealthy businessman Andrej Babis has been sworn in as the nation's new premier, with his full cabinet expected to be appointed within days. His selection came after a fundamental stipulation from President Petr Pavel – a formal assurance by Babis to give up control over his extensive agribusiness and chemical holding company, Agrofert. "I vow to be a prime minister who upholds the interests of every citizen, both locally and globally," declared Babis following the event at Prague Castle. "A leader who will work to transform the Czech Republic the finest location to live on the whole globe." High Aspirations and a Pervasive Business Presence These are grandiose goals, but Babis, 71, is familiar with large-scale thinking. Agrofert is so thoroughly integrated in the Czech economic fabric that there is even a specialized application to help shoppers steer clear of 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 – belongs to an Agrofert company, a warning symbol appears. Babis, who previously served as prime minister for four years until 2021, has moved rightward in recent years and his cabinet will feature members of the far-right SPD and the Eurosceptic "Drivers for Themselves" party. The Promise of Withdrawal If he honors his pledge to withdraw from the company he established, he will stop gaining from the sale of a single Agrofert product – ranging from processed meats to agricultural chemicals. As prime minister, he states he will have no information of the conglomerate's economic status, nor any ability to affect its prospects. Administrative decisions on public tenders or subsidies – whether Czech or European – will be made with no consideration for a company he will have severed ties with or profit from, he emphasizes. Instead, he explains that Agrofert, valued at $4.3bn (£3.3bn), will be transferred to a trust managed by an autonomous trustee, where it will remain until his death. Then, it will be inherited by his children. This arrangement, he remarked in a Facebook video, went "exceeded" the requirements of Czech law. Unanswered Questions What kind of trust has yet to be clarified – a trust under Czech law, or one in a foreign jurisdiction? The legal framework of a "blind trust" has no basis in Czech statutory law, and an team of legal experts will be needed to craft an solution that is legally sound. Doubts from Observers Critics, including Transparency International, remain unconvinced. "A blind trust is an inadequate measure," argued David Kotora, the head of Transparency International's Czech branch, in an statement. "The divide is insufficient. He is familiar with the managers. He knows Agrofert's portfolio. From an high office, even at a European level, he could possibly act in matters that would impact the sector in which Agrofert operates," Kotora warned. Wide-Ranging Interests Extending Past Agrofert But it's not only food – and it's not just Agrofert. In the eastern suburbs of Prague, a medical facility towers over the O2 arena. While it is the property of a company called FutureLife a.s, that company is majority-owned 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 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 about to get even wider.