Czech Agriculture Minister: Conflict-of-interest law is "confusing," and the Agrofert dispute is hurting the entire sector

Czech Agriculture Minister Martin Šebestyán has said that the country's current conflict-of-interest law is poorly and "confusingly" drafted, and that the scandal surrounding subsidy payments to the Agrofert holding from Prime Minister Andrej Babiš's trust fund has been damaging the entire agricultural sector for years.

According to the minister, Czech agriculture has gradually turned into little more than a raw-material supplier for processors abroad: the country exports agricultural raw materials while importing finished food products, draining revenue from the sector and making it increasingly dependent on subsidies from the EU and state budgets. Since 2019, cumulative inflation in Czechia has approached 40%, sharply eroding the real value of subsidy support, Šebestyán noted.

One of the key problems is land prices: a hectare of farmland now costs around 350,000 crowns on average, and in some cases as much as half a million. This, the minister said, seriously limits the entry of new farmers into the sector. The government is preparing a bill granting existing farmers a right of first refusal on land purchases, aimed at curbing land buy-ups by investors who do not actually farm the land themselves.

The minister also pointed to the market's structure: around 80% of food in Czechia is sold through the five largest retail chains, and no single domestic dairy company holds more than 10% of the dairy market — while large German and Polish producers are taking up an increasing share of shelf space.

Šebestyán separately commented on the situation surrounding the State Agricultural Intervention Fund, which he himself previously headed. At issue is a conflict-of-interest dispute tied to subsidies paid to the Agrofert holding from PM Babiš's trust fund. According to the minister, the fund always acted in accordance with European Commission requirements and, once the new prime minister was appointed, suspended the payments, commissioned legal opinions, and informed the relevant EU Directorate-General. Nevertheless, he acknowledged, an audit of the situation will likely follow, given the volume of inquiries received, including from the European Public Prosecutor's Office.

As for the accusations against his predecessor in the ministerial post, Christian Democrat leader Marek Výborný, who had referenced an analysis of possible irregularities worth up to 7 billion crowns, Šebestyán said no such analysis was ever published, and that the whole issue, in his view, was more about pre-election rhetoric than substance.

Turning to the forthcoming amendments to the conflict-of-interest law, the minister noted that shortening the statute of limitations for such cases from ten years to four is in line with common European practice, though the question of the law's retroactive effect is still to be debated by lawmakers. He stressed, however, that in his view the current law was poorly drafted from the outset.

Šebestyán said that four years of so-called "de-Agrofertization" have noticeably weakened the Ministry of Agriculture: its share of state budget spending has fallen from roughly 4.5% to 2.5%, while budgets of other ministries — health, for instance — grew by about 100% over the same period, and the environment ministry's by 30–40%.

Around Prague, based on reporting by novinky.cz