Czech billionaire Babis fights fraud trial alongside presidential contest

PRAGUE (Reuters) - Czech billionaire and former Prime Minister Andrej Babis returned to court to fight fraud accusations over a 2 million euro subsidy on Wednesday, days before a presidential election in which he is a favourite begins.

Babis has been a dominant force in Czech politics for the past decade, first as a powerful finance minister and later as prime minister, before opposition parties combined to unseat him in an 2021 election despite his ANO party winning the most seats in parliament.

With his party in opposition now, Babis, 68, is seeking to win the presidency and replace his frequent ally, Milos Zeman, whose second term ends in March.

But the owner of the Agrofert chemicals, farming, food and media conglomerate, now sitting in a trust, has long faced conflict of interest allegations because of his vast business empire.

Babis's trial involves charges he illegally tapped an EU subsidy, before he formed his ANO party in 2011, to build the Stork's Nest conference centre near Prague by hiding his ownership in the project.

Babis has denied wrongdoing and has repeatedly dismissed the case against him as political. He did not speak to reporters before entering court on Wednesday.

Even if the court finds Babis guilty, possibly sentencing him to a jail term, he can appeal against, likely to be heard ahead of the vote. The trial itself, though, may repel some undecided voters in the presidential election, observers say.

Babis, the fifth-richest person in the country according to Forbes' 2021 list, is one of the favorites in the election, whose first round of voting starts on Jan. 13-14.

Polls project Babis, former Czech Army top general Petr Pavel and former university rector Danuse Nerudova as all having equal chances to advance to a second round where the top two candidates will clash on Jan. 27-28.

Polls show Babis losing in the second round.

Babis's ANO, though, has continued to lead party polls even as its leader has faced conflict of interest allegations.

The European Commission found him in conflict of interest as Agrofert, employing over 30,000, tapped development subsidies while he was in government.

French prosecutors have also investigated him over the purchase of property in France via offshore firms, according to Le Monde newspaper. He has denied all wrongdoing.

(Reporting by Robert Muller; Editing by Jason Hovet nd Nick Macfie)