Czech Election Favorite Faces Loss of Immunity Before Vote

(Bloomberg) -- Czech lawmakers launched a process to strip billionaire Andrej Babis of his parliamentary immunity over fraud allegations, the biggest challenge to his ambition to lead the country’s next government after October elections.

Babis, whose euro-skeptic ANO movement holds a strong lead in opinion polls, is facing a police investigation over the alleged misuse of European Union aid funds. The parliamentary immunity committee began deliberations on Friday over whether to strip him and one of his closest allies of protection that shields all lawmakers from criminal charges. Babis, the second-richest man in the country of 10.6 million people, has denounced the accusations as fabrications from his political rivals.

Czech Election Favorite Faces Loss of Immunity Before Vote

“It looks like parliament will allow him to be investigated,” said Jan Bures, a political scientists at Metropolitan University in Prague. “Of course, Babis may use it to portray himself as the victim of what he calls his corrupt political adversaries.”

The case represents a test of loyalty for Babis’s supporters, who stuck by him after ANO joined the three-party ruling coalition almost four years ago. Babis’s rivals in the government and opposition accuse him of tax evasion and conflicts of interest stemming from his chemical, food and media empire. He built his popularity with pledges to cut the country’s debt and by attacking traditional parties as corrupt, inept managers of the state, echoing the platforms of populist forces challenging the political establishment across Europe.

Babis, whose fortune is estimated at $3.6 billion, has rejected all accusations of tax evasion and said he did nothing illegal in the case of a 50 million-koruna ($2.2 million) EU subsidy transferred to his Stork Nest recreation complex. The center belonged to Babis’s business empire in the past, but he told a parliamentary hearing last year that it was owned by his children and his brother-in-law when the application for EU funds was filed. He transferred all his assets to a trust fund, supervised by his wife, this year after his coalition partners teamed up with opposition to tighten the conflict-of-interest law.

Babis popularity has risen steadily despite attacks from government parties -- the cabinet-leading Social Democrats are his biggest rivals before the elections -- and the opposition. ANO’s support has ranged from 27 percent to 34 percent in opinion polls in the past two months, compared with 19 percent it received in the 2013 election and more than 10 percentage points above the nearest competitor.

The parliamentary immunity committee adjourned the meeting and invited Babis, ANO deputy Chairman Jaroslav Faltynek, the police investigator and the supervising prosecutor for questioning on Aug. 30, Miroslava Nemcova, the head of the panel, told reporters on Friday. If the committee recommends removing cover of immunity, the motion will have to be approved by a vote in the full chamber, which convenes for next session on Sept. 5. The billionaire has vehemently fought the accusations, saying he sees no reason to give up his parliamentary mandate.

“It’s an attempt to influence elections,” Babis said on Twitter on Thursday. “To me, the timing is clear.”