Procedure : 2018/2975(RSP)
Document stages in plenary
Document selected : B8-0583/2018

Texts tabled :

B8-0583/2018

Debates :

PV 12/12/2018 - 23
CRE 12/12/2018 - 23

Votes :

Explanations of votes

Texts adopted :

P8_TA(2018)0530

MOTION FOR A RESOLUTION
PDF 177kWORD 54k
See also joint motion for a resolution RC-B8-0582/2018
11.12.2018
PE631.606v01-00
 
B8-0583/2018

to wind up the debate on the statements by the Council and the Commission

pursuant to Rule 123(2) of the Rules of Procedure


on conflicts of interest and the protection of the EU budget in the Czech Republic (2018/2975(RSP))


Bart Staes, Julia Reda, Philippe Lamberts on behalf of the Verts/ALE Group

European Parliament resolution on conflicts of interest and the protection of the EU budget in the Czech Republic (2018/2975(RSP))  
B8‑0583/2018

The European Parliament,

–  having regard to its previous decisions and resolutions on discharge to the Commission(1) for the years 2014, 2015 and 2016,

–  having regard to Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union(2) (the new Financial Regulation), in particular Article 61 thereof on conflicts of interest,

–  having regard to the questions to the Commission sent by the Czech Pirate Party on 2 August 2018,

–  having regard to the official complaint lodged with the Commission by Transparency International Czech Republic on 19 September 2018,

–  having regard to the opinion of the Commission’s Legal Service of 19 November 2018, entitled ‘Impact of Article 61 of the new Financial Regulation (conflict of interests) on payments from the European Structural and Investment (ESI) Funds’,

–  having regard to the presentation given on 20 November 2018 by the Commission’s Directorate-General for Budget to Parliament’s Committee on Budgetary Control, entitled ‘Conflict of Interests Rules in the Financial Regulation 2018’,

–  having regard to Rule 123(2) of its Rules of Procedure,

A.  whereas the provision in the 2012 Financial Regulation on conflicts of interest did not apply explicitly to shared management, but Member States were required to ensure effective internal control including the avoidance of conflicts of interest;

B.  whereas public procurement rules oblige Member States to avoid conflicts of interest (Article 24 of Directive 2014/24/EU(3)), including direct or indirect personal interests, and for situations perceived as conflicts of interest or specific obligations in shared management, rules (e.g. Regulation (EU) No 1303/2013(4)) are already in place;

C.  whereas the Council adopted the new Financial Regulation on 18 July 2018; whereas Article 61 of the Financial Regulation, which prohibits conflicts of interest, entered into force on 2 August 2018;

D.  whereas Article 61(1) of the Financial Regulation (in conjunction with Article 61(3)) lays down:

(i) a negative obligation on financial actors to prevent situations of conflicts of interest in relation to the EU budget;

(ii) a positive obligation on financial actors to take appropriate measures to prevent a conflict of interest from arising in the functions under their responsibility and to address situations which may objectively be perceived as a conflict of interest;

E.  whereas according to the case law of the Court of Justice of the European Union(5) ‘the conflict of interests constitutes, objectively and in itself, a serious irregularity without there being any need to qualify it by having regard to the intentions of the parties concerned and whether they were acting in good or bad faith’; whereas the Commission is obliged to suspend EU fund payments in cases where a serious deficiency in the functioning of the management and control systems exists and where undiscovered, unreported and uncorrected serious irregularities related to the conflict of interest have come to light;

F.  whereas on 19 September 2018, Transparency International Czech Republic lodged a formal complaint with the Commission claiming that the Czech Prime Minister, Andrej Babiš, has persistently violated EU and Czech legislation on conflicts of interest;

G.  whereas Mr Babiš has also been revealed to be the beneficial owner of Agrofert, i.e. the managing company of the Agrofert Group, through two trust funds, AB I and AB II, that cannot be considered as blind trusts and of which he is the founder and at the same time the sole beneficiary;

H.  whereas companies belonging to the Agrofert Group take part in projects subsidised by the Rural Development Programme of the Czech Republic, which in turn is funded by the European Agricultural Fund for Rural Development;

I.  whereas companies belonging to the Agrofert Group have received significant sums from the ESI Funds during the 2014-2020 period, ranging from EUR 42 million in 2013 to EUR 82 million in 2017;

J.  whereas according to the declaration of income of Czech public officials, Mr Babiš received an income of EUR 3.5 million during the first 6 months of 2018 from the Agrofert Group via his trust funds;

K.  whereas Parliament has repeatedly called on the Commission in its 2016, 2017 and 2018 annual reports on the Commission’s discharge to speed up a conformity clearance procedure started in January 2016 with the aim of obtaining detailed and precise information on the risk of a conflict of interest concerning the State Agricultural Intervention Fund in the Czech Republic, and has stressed that failure to take the necessary measures to prevent a conflict of interest could ultimately oblige the Czech competent authority to withdraw the accreditation of the paying agency and could also lead to the application of financial correction by the Commission;

L.  whereas Parliament’s Committee on Budgetary Control decided in September 2018 to take up this issue in the framework of the annual discharge procedure, notably in the hearings with the Commissioners most concerned by the problem;

M.  whereas the hearings with Commissioners held by the Committee on Budgetary Control as part of the annual discharge procedure did not provide MEPs with sufficient and clear answers on the state of play of the potential conflict of interest of the Czech Prime Minister;

N.  whereas on 1 December 2018, reports in the European media, including The Guardian, Le Monde, De Standaard and the Süddeutsche Zeitung, brought to light the information about the legal opinion drafted by the Commission’s Legal Service confirming Mr Babiš’s conflict of interest;

1.  Notes that the 2016 discharge report (adopted in April 2018) ‘welcomes the fact that the European Anti-Fraud Office (OLAF) has completed its administrative investigation into the Czech “stork nest” project’, ‘takes note that the OLAF case file has been publicised by the Czech media’, and ‘regrets that OLAF found serious irregularities’;

2.  Is deeply concerned about the Czech Republic’s non-compliance with Article 61(1) of Regulation (EU) No 2018/1046 regarding the conflict of interest of the Czech Prime Minister and his links to the Agrofert Group;

3.  Deplores any kind of conflict of interest that could compromise the implementation of the EU budget and undermine the trust of EU citizens in the proper management of EU taxpayers’ money; calls on the Commission to ensure that a zero tolerance policy with no double standards will apply regarding conflicts of interest of any EU politicians, and to find no excuse for delays when protecting the financial interests of the Union;

4.  Calls on the Commission to set the active avoidance of conflicts of interest as one of its priorities and, as guardian of the Treaties, to take effective and rapid action in such cases, especially when national authorities fail to act to prevent conflicts of interest of their highest representatives;

5.  Calls on the Commission to follow up on this issue without delay, on the basis of the opinion of its Legal Service stemming from the complaint by Transparency International Czech Republic, and to implement the necessary corrective measures and procedures to amend any possible illegal state of affairs, including a measure to suspend all EU funding to the Agrofert Group until the conflict of interest has been fully investigated and resolved;

6.  Also calls on all EU heads of state and government and government officials to proactively apply the new Financial Regulation, especially the section on conflicts of interest, in order to prevent situations harmful to the EU’s or individual Member States’ reputations, democracy or the EU’s financial interests, and to serve as an example of working for the public good, not personal gain;

7.  Calls on the Member States’ national parliaments to make sure that none of the national legislation on the prevention of conflicts of interest goes against the spirit of the new Financial Regulation;

8.  Calls on the Commission to ensure that action plans on conflicts of interest are prepared and implemented in each Member State, and to report back to Parliament on the progress thereof;

9.  Takes note of the opinion drafted by the Commission’s Legal Service on the possible conflict of interest of the current Czech Prime Minister, Mr Babiš, in his role as Minister of Finance in 2014; demands that the Commission fully investigate the legality of all EU subsidies paid to the Agrofert Group since Mr Babiš joined the Czech Government, taking into account the previous Financial Regulation applicable prior to 2 August 2018 and the section therein on conflicts of interest;

10.  Calls on the Commission to make available to the Committee on Budgetary Control all documents connected to the case of possible conflicts of interest of the Czech Prime Minister and also of the Minister of Agriculture;

11.  Calls for the Council and for its own negotiators on the multiannual financial framework (MFF) to insist on full transparency of any connections Mr Babiš has with the Agrofert Group and ensure that these do not interfere with his role as Prime Minister of the Czech Republic, and to take all necessary and appropriate measures to prevent any conflicts of interest in the negotiations of future EU budgets and of the MFF, in line with Article 61(1) of Regulation (EU) 2018/1046;

12.  Calls for its Committee on Budgetary Control to include the prevention of conflicts of interest and reporting on actions taken in this regard in the annual discharge report to the Commission;

13.  Instructs its President to forward this resolution to the Commission, the Council and the Government and Parliament of the Czech Republic.

 

(1)

OJ L 246, 14.9.2016, p. 1, OJ L 252, 29.9.2017, p. 1, and OJ L 248, 3.10.2018, p. 1.

(2)

OJ L 193, 30.7.2018, p. 1.

(3)

OJ L 94, 28.3.2014, p. 65.

(4)

OJ L 347, 20.12.2013, p. 320.

(5)

Ismeri Europa Srl v Court of Auditors, Judgment of 15.6.1999, Case T-277/97, ECLI:EU:T:1999:124.

Last updated: 11 December 2018Legal notice