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Leader of ANO Party Andrej Babis meets President Milos Zeman in Prague, Czech Republic October 31, 2017. REUTERS/David W Cerny


PRAGUE (Reuters) - Czech police have requested parliament lift the immunity of prospective prime minister Andrej Babis to allow prosecution in a case involving alleged fraud in tapping European Union subsidies, CTK news agency reported on Tuesday.

Babis, whose ANO party was the runaway winner in a parliamentary election in October, denies any wrongdoing and has called the charges politically motivated.

Police suspect the billionaire businessman hid ownership of the Stork's Nest farm and convention centre almost a decade ago to get a two million euro EU subsidy that was part of a programme aimed at small businesses.

President Milos Zeman has tasked Babis with forming a government, but the case has hurt his chances of assembling a coalition as almost all of the other eight parties in the lower house have refused to work with him if he faces police charges.

Babis instead is aiming for a minority cabinet, which may be appointed in the coming weeks, but still faces the prospect he may lose a vote of confidence in the 200-seat lower house.

His party won 78 seats in the election and he has not found other support than possible tolerance from the Communist party with 15 seats.

A failure to win confidence would trigger two more attempts to form a cabinet, which could take months, while Babis's team would hold office in the meantime.

The lower house already voted in September to allow his prosecution, but Babis won immunity again with his re-election. Most parties have said they would vote to lift immunity again but it was not clear if a majority would be found.

The case also involves ANO's deputy chairman Jaroslav Faltynek, who has also denied wrongdoing.

A spokeswoman for the Prague district attorney's office said the police had "delivered a request to the house to lift immunity of two lawmakers in connection with the Stork's Nest case". She declined to give the names of those involved.

Babis moved his holding in his business empire - valued at $4 billion and comprising numerous companies in food processing, agriculture, chemicals and media - to trust funds earlier this year.

The October election saw a shift to anti-establishment parties and Babis's ANO movement won three times the votes of its nearest rival, attracting voters with pledges to run the state more effectively and weed out corruption.

(Reporting by Robert Muller; Editing by Alison Williams and William Maclean)

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