The European Public Prosecutor’s Office (EPPO) has opened a criminal investigation into financial misconduct in connection with food, agriculture and chemical conglomerate Agrofert in connection with its links to its founder Czech Prime Minister Andrej Babiš.

“After a thorough review of information I have issued a decision on launching a criminal inquiry,” European prosecutor Daniela Bártíková wrote in a document seen by Czech online news outlet Seznam Zprávy (SZ).

Babiš, whose populist Ano party won the October general election, announced he would dispose of Agrofert in order to pave the way for his appointment as prime minister.

In February, Babiš placed Agrofert into RSVP Trust, but transparency watchdogs pointed out that this may not be sufficient to solve the PM’s conflict of interests. The opposition liberal Pirate Party filed a criminal complaint over the continued payments of EU subsidies to Agrofert while Babiš is involved in negotiations over the new EU budget.

“Politicians and officials signed under billions for Agrofert come under scrutiny of European prosecutors, with whom Czech police is obliged to cooperate,” SZ wrote in connection with the EU probe, which does not yet amount to an indictment but may involve questioning of witnesses and deploying of eavesdropping devices, the outlet noted.

Even though Agrofert is also a recipient of Czech national subsidies, the probe concerns only cases of handling European resources, SZ noted, referring to the European prosecution document.

Czech Supreme State Prosecution and Supreme Prosecution in Prague were provided with the relevant information, SZ noted, adding that Prague supreme prosecutor Zdeněk Štěpánek opposes separate inquiries and wants a joint inquiry with the EU authorities instead.

“In the said matter there should be joint inquiry carried out as the criminal code stipulates. The splitting up of the matter could impede clarification of the case,” Štěpánek was quoted as saying by SZ.

Since placing Agrofert in the trust Babiš has repeatedly stated he considers the issue of his conflict of interest solved, and largely ignored calls of the Czech branch of Transparency International (TI) to disclose the detailed structure of RSVP Trust.

Back in February, the European Commission demanded Czechia explain how it was going to address Babiš’ conflict of interests in connection to his ties to Agrofert.

Czech Ministry of Regional Development responded to the EC that “no subsidies have been paid to applicants affected by the conflict of interests,” Czech Radio and Czech Press Agency reported. However, the state of Czech conflict of interests legislation has been criticised by TI and other transparency watchdogs for being too loose and EC is supposed to be monitoring payments involving public resources to a number of companies linked to Babiš.