Galic Winery must return 10 million kuna to European Union funds
August 22, 2021 – Bad news for the famous Galic winery, which now has to return a whopping 10 million kuna from its allocated wine envelope.
As Poslovni Dnevnik writes, Galic Winery, owned by entrepreneur Josip Galic from Kutjevo, must return 10 million kuna of the wine envelope allocated to it through the European Agricultural Guarantee Fund for the construction of ‘a new cellar building in Kutjevo worth seven million euros.
The Agency for Payments in Agriculture, Fisheries and Rural Development, on the basis of the recommendation of the European Anti-Fraud Office (OLAF), recently issued a decision overturning the decision approving the Galic project Winery and made a decision on the return of aid payments in the amount of 10,047,442.29 kuna, writes the Jutarnji list. This is the first such case, according to the same publication.
OLAF said that during the construction of the cellar there had been malfeasance and abuse in the selection of contractors, i.e. subcontractors. In this particular case, one of the subcontractors for the construction of the wine cellar was the company Presoflex owned by Ina Galic, the child of Josip Galic.
It should be noted that Galic Winery hired one company as a contractor, then five sub-contractors, including the aforementioned company of Galic’s child, which OLAF considers a conflict of interest, explaining that “ the legislative framework prohibits users of EU funds from projects for which they have received money to hire companies with which they have personal or professional relationships, ” Jutarnji list reports.
The Galic winery said it was shocked by this decision, which it is trying to challenge because it considers it illegal. The agency said the decision had been made “On the basis of article 33, paragraph 2, of the ordinance on the application of the measure Investments in cellars and the marketing of wine of the National Support Program for the wine industry 2014-2018, which provides that the paying agency will request a refund if it is determined that the beneficiary has acted contrary to the provisions of the ordinance and the rules for the use of these funds for the investment measure, i.e. in case of ‘irregularity established,’
They also stated that during the approval of the now disputed Galic Winery project, as well as during the monitoring of its implementation, the Agency was not aware that a company owned by Galic’s offspring was engaged in the project, and that the beneficiary had previously informed of all the obligations arising from the decision to approve the project.
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