Statement by the PORTOS Law Firm on the Assessment of Conflict of Interest Issues for the State Agricultural Intervention Fund (SZIF)

The opinion of the State Agricultural Intervention Fund (SZIF) on the issue of conflict of interest from last week has aroused justified interest from the media and the public. In connection with this, however, there are also misleading and untrue statements appearing in the public space concerning the provision of legal services to SZIF by the law firm PORTOS. We therefore consider it necessary to set the record straight regarding key facts.

We object to the assertions that the conclusions in two assessments our law firm prepared for SZIF over the last eight months are contradictory regarding the same assignment. The subject of the original assessment from 2025 was the question of the applicability of Section 4c of the Act on Conflict of Interest to the provision of entitlement-based subsidies, this solely with regard to the linguistic interpretation of the relevant provision. The restriction of this assessment to only this method of interpretation is expressly stated in its concluding summary.

The current analysis then focused on a comprehensive assessment of the scope of applicability of the prohibition under Section 4c of the Act on Conflict of Interest, using all relevant methods for the interpretation of legal norms – i.e., linguistic, logical, systematic, historical, teleological, and comparative interpretation. The assignment for the newer assessment was thus significantly broader than that of the original one (from last year).

Based on the analysis performed, we have concluded that the applicability of the prohibition under Section 4c of the Act on Conflict of Interest to the provision of entitlement-based subsidies follows only when applying the literal linguistic interpretation. In this respect, the conclusions of the current and the original assessment are therefore identical. However, in the context of other legal interpretation methods, this conclusion stands alone. The interpretation of Section 4c of the Act on Conflict of Interest conducted through other methods of interpretation (especially historical and teleological interpretation) suggests that the prohibition in question applies exclusively to the provision of discretionary subsidies.

Since these aspects were not the subject of the original assessment, by their very nature there are no contradictions between the original and current assessment in this regard. We therefore continue to stand firmly behind the conclusions of both assessments.

Neither the original nor any other of our assessments ever included a recommendation relating to the retrospective recovery of entitlement-based subsidies from companies in the group AGROFERT. Similarly, none of the assessments contained recommendations not to recover subsidies from the affected subsidy applicants/subsidy recipients.

Nevertheless, we are convinced that the current property structure of companies in the group AGROFERT is, from the perspective of resolving conflicts of interest under the Czech legal regulation for the provision of agricultural subsidies, sufficient. Likewise, based on publicly available information and materials that law firm PORTOS had at its disposal for the preparation of the assessment, it is possible to consider the independent management regime of the trust fund RSVP TRUST sufficient from the perspective of resolving conflicts of interest according to Article 61 of the EU Financial Regulation.

The conclusions of our assessment are related to the current regime of independent management, not to speculation on the possible future setup of the management of the RSVP TRUST trust fund once Andrej Babiš ceases to hold the position of Prime Minister. One of the causes of debates about the conclusions of the assessment regarding the eligibility of companies in the group AGROFERT k&nbsp to receive agricultural subsidies from the perspective of legal regulation on conflict of interest, in our view, is, among other things, the less successful legislative regulation that has caused difficulties for subsidy providers as well as public contract awarding entities for many years.

All legal and consulting services of the law firm PORTOS have always been and will always be provided with the highest professional care, with regard to the rights and legitimate interests of the client (SZIF), independently and in accordance with obligations arising from the Act on Advocacy, the code of ethics and other legal and professional regulations, and not in favor of any third party.

Read more in interview with Jaromír Císař by Hospodářské noviny at archiv.hn.cz