"EU Freezes Czech Funds: The Babiš Business Scandal Explained"
“I don’t care,” Andrej Babiš responded. Yet the message from Brussels carried serious consequences: The European Commission confirmed yesterday that it is once again withholding EU payments to the Czech Republic due to an ongoing conflict of interest.
What happened?
Babiš is not only the Czech prime minister, he’s also the owner of the Agrofert conglomerate. The allegations stemming from this dual role are nothing new. During his first term as prime minister from 2017 to 2021, the EU Commission found that, despite transferring Agrofert into a trust, Babiš continued to benefit financially from the company. The issue? Agrofert is one of the largest recipients of EU subsidies in the Czech Republic. As a result, the Commission already halted certain EU fund reimbursements to Agrofert back in 2020.
Babiš returned as prime minister in December 2025. Before taking office, he placed Agrofert into a new trust structure, supposedly to resolve the conflict of interest. However, key details about how this trust operates remain undisclosed. Doubts persist over whether Babiš has truly relinquished control and financial benefit from Agrofert, especially since it appears his children may take over the trust after his term ends.
What did the Commission’s latest investigation find?
Yesterday, the Commission confirmed what critics have long argued: The new trust structure still fails to eliminate the conflict of interest. Until Czech authorities address the issue, expenses for companies controlled by or linked to Babiš cannot be reimbursed by the EU. According to Czech officials, this currently affects around €3.18 million from the European Agricultural Fund for Rural Development. Normally, these funds are advanced by the member state’s government and later reimbursed by Brussels.
Does freezing the funds solve the problem?
Unfortunately, no. While the Commission’s action is a step in the right direction, two major issues remain:
First, negotiations are currently underway for the next EU budget starting in 2028, which includes future agricultural subsidies. As Czech prime minister, Babiš is at the table, helping shape the rules for funds that his own businesses could benefit from. This includes direct payments – which haven’t been suspended – as well as other EU funds that will resume flowing once Babiš is no longer in office.
Second, it’s unclear whether the Commission even has a complete overview of all the companies Babiš owns or controls – and whether Czech authorities are truly withholding EU funds from any of them. In short, it’s uncertain how effectively the suspension will be implemented in practice.