Prague - The Czech Transport Ministry may lose the EU subsidies for its D8 highway project connecting Lovosice with Usti nad Labem, warned the Luxembourg-based European Court of Auditors (ECA) in a report.
The report criticized the way Czech authorities control EU-funded projects. While the Czech Finance Ministry's audit organ discovered flaws in only 1.85 percent of transport subsidies, EU auditors found errors in more than 40 percent.
The ECA's accusation is serious especially in the light of the fiscal data manipulation in Greece that sparked the country's ongoing crisis.
The report also provided a detailed explanation of why the D8 highway project cannot be paid from EU funds and why the Czech Republic should return the EUR 160 millions already allocated to the project.
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The tender for the D8 highway construction was issued five years ago, when the Transport Ministry was headed by Ales Rebicek.
According to the report, the tender was tailor-made for the Czech Metrostav construction firm, with strict conditions virtually disqualifying all foreign bidders (Czech language requirements) as well as Metrostav's competitors in the Czech Republic.
The contract was eventually awarded to a consortium of Metrostav and Eurovia.
"The technical selection requirements were too restrictive and did not allow a real competition," said the report.
The ECA also points out that the blame lies not only on the Czech Transport Ministry but also on the Czech Office for Protection of Competition, which ignored complaints raised by the German-Czech Chamber of Commerce and Transparency International.
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In addition to the D8 highway construction, the ECA looked into another five EU-sponsored projects. In three of them they found such serious errors that they banned the payment of subsidies.
One of the three cases was an EUR 240 million contract for acquisition of 100 new trams in Brno.
The contract clearly favored Skoda Transportation, a Czech manufacturing company. That's why it was the only firm that participated in the tender, wrote the ECA. And, yet again, the Czech Office for Protection of Competition failed to act, the auditors reminded.
