Monday, 11 December 2017

Court cancels orders freezing property of FAU fuel trader

ČTK |
25 September 2017

Ostrava, North Moravia, Sept 22 (CTK) - A Czech regional court cancelled the orders by which the customs authorities froze the property of the FAU fuel-trading company worth about 340 million crowns because there was no reason to issue such extensive freezing orders, it ruled on Friday.

After the intervention of the financial and customs authorities, FAU went insolvent last October and a court launched bankruptcy proceedings against it two months later.

FAU legal representative Alfred Sramek told journalists that the firm would probably claim compensation worth several billion crowns from the state if the freezing orders are cancelled definitively.

The judge, Jiri Gottwald, said the fact that the tax a firm will have to pay is higher than the finances available to the firm at the moment is not a sufficient reason for the issuing of freezing orders immediately followed by the seizure of property.

A freezing order should be a step taken only in the most extreme cases, Gottwald said.

General Directorate of Customs spokeswoman Martina Kankova told CTK that the Customs Administration would comment on the decision on Monday.

However, the Customs Administration is likely to appeal, the official representing it in court said.

Sramek said this is yet another step leading to the absolute defeat of the financial and customs administrations in the FAU case.

FAU owns a warehouse located in the complex belonging to the Precheza company, a part of the giant chemical, agricultural and food processing Agrofert holding which ANO leader Andrej Babis, former finance minister, owned before transferring it to a trust fund in February.

An audio recording appeared on Twitter with Babis speaking of a crackdown on FAU. Czech media speculated that the Financial Administration tried to liquidate FAU on purpose at Babis's request. Billionaire Babis said he neither tasked nor misused the tax or customs authorities as finance minister before May 2017.

The Financial Administration said it had good reasons to suspect FAU of involvement in a large-scale VAT fraud, in which firms attempted to cheat the Czech state.

FAU filed several complaints against the state and courts decided in favour of the firm in a part of them.

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