The Czech Pirates party issued a press release on June 27 calling on Agrofert – the company that the country’s prime minister Andrej Babis transferred to trust funds last year – to return European Union subsidies worth millions of euros.

According to Pirate spokeswoman Karolina Sadilkova, seven firms belonging to Agrofert unlawfully received at least 4.2m crowns in EU subsidies in 2015. The firms reportedly collected funds for insurance against damage caused by weather and pests.

The catch is that the subsidies were intended for small businesses. Only small and medium-sized businesses with up to 250 employees and an annual turnover of maximally €50m euros (about 13m crowns), should have been eligible for the subsidies.

As reported by The Prague Daily Monitor, Agrofert is the biggest food and agricultural concern in the Czech Republic. In 2017, Agrofert had 33,000 employees and a turnover of 155bn crowns.

The local daily Hospodarske noviny (HN) published an article earlier in the week announcing that the Czech authorities have launched an investigation.

“All cases of possible unlawful drawing of subsidies are subject to checks,” the fund’s spokeswoman Neli Vesselinova told HN. If a subsidy is drawn unrightfully, firms may have to return the paid sums plus interests, she said.

But Agrofert spokesman Karel Hanzelka told the daily that the firms had a right to collect the subsidies even though they were part of Agrofert.

Meanwhile, Babis faces criminal prosecution over a suspected EU subsidy fraud related to the Capi hnizdo conference centre and farm. Capi hnizdo belonged to a firm from Agrofert. It changed owner, received a subsidy for small businesses and eventually returned under Agrofert ownership.

According to The Prague Daily Monitor, the investigators have concluded that the only reason for the change of owner was the effort to illegally win the subsidy.