Industryweek 6812 Croatia Try Hungary Oil Boss Graft

Croatia to Try Hungary Oil Boss for Graft

June 10, 2014
A Croatian court rules to try the head of Hungary's MOL energy group on charges of bribing a former prime minister in order to gain control of Croatia's state-run oil and gas company.

ZAGREB, Croatia -- A Croatian court ruled on Tuesday to try the head of Hungary's MOL (IW 1000/179) energy group on charges of bribing a former prime minister in order to gain control of the state-run oil and gas firm here.

The tribunal in Zagreb confirmed the bribery indictment against Zsolt Hernadi, chief executive of MOL, and agreed to the prosecutors' request to hear the trial in absentia.

Hernadi's defense attorney said he would appeal the decision, state-run HINA news agency reported.

Croatia's anti-graft prosecutors charge Hernadi paid 10 million euros ($13.7 million) to former Croatian prime minister Ivo Sanader in order to secure "a dominant influence" in the country's state-run oil and gas group, INA (IW 1000/726).

Both MOL and Sanader deny the charge.

Sanader was sentenced to 10 years in prison in 2012 for corruption, including taking the bribe from MOL. A Supreme Court ruling on his appeal is expected in the coming weeks.

MOL took a controlling stake of 49.1% in INA 2009, but has since been embroiled in a series of disputes over management of the company with the Croatian government, which holds a 44.8% stake.

Both sides have sought international arbitration over the issue, and in November MOL began the process of offloading its stake in INA.

Tensions were raised in October when Croatia, which joined the European Union last year, issued an Interpol and European arrest warrant for Hernadi on bribery charges.

MOL, whose largest shareholder is the Hungarian government, has rejected the allegations. A Budapest court threw out the arrest warrant claiming lack of evidence.

Last month a Hungarian court cleared Hernadi of fraud and bribery charges in a civil case brought by a former employee and shareholder.

Tackling corruption was a key part of Croatia's bid to become EU's 28th member.

Copyright Agence France-Presse, 2014

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