Case involves dealings of H.E. William Cabaniss with former Defense Minister Martin Barták

Prague, March 17 (ČTK) — Former Tatra supervisory board head and U.S. Ambassador to the Czech Republic (2004–06) William Cabaniss today provided testimony for five and a half hours in the trial of former Defense Minister Martin Barták, who is facing corruption charges over the purchase of the Tatra lorries for the Czech military.

Along with Barták, arms dealer and lobbyist Michal Smrz is charged in the case.

According to the charges, Barták in his capacity as deputy defense minister attempted to influence the contract on the supply of several hundred Tatra off-road vehicles for the Czech military.

The indictment says that while on a business trip to the United States in February 2008, Barták committed bribery when unsuccessfully demanding money from Cabaniss at the Bull Run Public Shooting Center firing range in Centreville, a suburb of Washington D.C., located in the commonwealth (state) of Virginia.

With the money, the firm was to ensure a smooth course of the tenders put up by the Defense Ministry.

Cabaniss told the court today he had spoken with former Czech Prime Minister Mirek Topolánek and other members of his delegation at the meeting. He said he had also met Barták who demanded the money.

Barták dismissed it. He said he did not demand a bribe. Cabaniss said today he could not recall the sum or whether it was offered in dollars or crowns.

He said he considered this statement by a deputy defense minister very unsuitable and as he did not know how to react, he left.

Cabaniss described the problems with Praga that was to deliver axles under the deal.

However, as they were faulty, Tatra terminated its contract with Praga, which caused a court dispute between the two companies.

Barták said Czech top politicians at the time wanted Praga to get some compensation for having to leave such a huge contract. He said he only defended the interests of Czech firms.

Cabaniss went on to explain why he failed to tip off the U.S. authorities about the alleged attempted bribery. He said he did not know to whom he ought to have reported the case.

Cabaniss said he did not think that the U.S. authorities could have done anything with it.

He said he had only reported the alleged bribery two years later, when reporters started taking interest in the case.

Another reason was that a new government, headed by Petr Nečas (Civic Democratic Party, ODS), was formed and it pledged to combat corruption.

Cabaniss said the firm only reported the case as bribery later, when it became a public affair.

He said Duncan Sellars, a former manager of the firm, had also heard about the bribe at the Centreville meeting. Sellars is scheduled to provide his testimony Wednesday.

According to the indictment, Smrz, owner of the MPI Group arms maker, attempted to extract money from Tatra representatives by pretending influence on and contacts with high-ranking government and Defense Ministry officials.

In January 2008, Smrz allegedly promised then Tatra director general Ronald Adams to arrange a personal meeting with Topolánek, first for 100 million Kč and later for 20 million Kč.

Both Barták and Smrz have denied any wrongdoing, calling the charges framed.

Read more: http://www.praguepost.com/czech-news/37821-former-u-s-ambassador-speaks-before-czech-court#ixzz2wXDBZGKx
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Prague, March 6 (ČTK) — The Indian government will probably start purchasing the Czech Tatra lorries for its military again after having suspended a long-term contract on them over a corruption scandal connected with commissions for Tatra’s former Indian co-owner Ravinder Kumar Rishi, daily Právo writes today.

Rishi is being investigated in India on suspicion of involvement in an intermediary firm that was buying sets for assembling Tatra lorries at a low price and resold them to the BEML Indian state company with a lucrative margin. The final selling price was three times higher than the purchasing price, according to some sources, Právo writes.

Rishi, who then owned 40 percent of Tatra’s stock and was also a member of its supervisory board, was profiting a lot from the dubious transaction, Právo says.

The new owners, who bought Tatra in an auction last year after it had ended up in insolvency, want to prevent such disadvantageous deals.

“The price [for India] has not been set yet but the contract must be advantageous for Tatra as a business entity. In no case will it be possible that a mediator could … profit from it, while the company would suffer a loss like in the past,” Tatra spokesman Andrej Čírtek told Právo.

He said all documents for the contract with the Indian government had been prepared. They are yet to be signed by the [Indian] defense minister, he added.

Právo writes that Rishi is also suspected of bribery in connection with the contract on Tatras in India. The local authorities started investigating it two years ago and banned Rishi from traveling to the CzechRepublic not to influence witnesses.

Two weeks ago, the investigators questioned representatives of the BEML, which had paid commissions to Rishi for Tatra lorries at variance with Indian law, Právo says, referring to the Indian Express daily.

Právo writes that Czech police were also looking into the alleged siphoning off Tatra’s assets by the disadvantageous supplies to India, on the basis of a legal complaint filed by defense lawyer Václav Láska. They shelved the case last year, concluding that no crime had been committed.

However, Láska argues that policemen did not deal with the main argument of his complaint, that is the possible systemic siphoning off money from the lorry maker.

“The police investigators did not look for information in India at all and they questioned only the Tatra management,” Láska said.

The heart of the matter is that the Tatra sets were bought at a too low price in the Czech Republic and sold in India fro much more money, he pointed out.

Láska said he had filed a complaint against the police’s steps in the case some time ago. However, state attorney Dušan Táborský swept it from the table as unsubstantiated, Právo says.

It recalls that Táborský is also in charge of the case of the alleged corruption accompanying the purchase of Tatra lorries for the Czech military in which former defense minister Martin Barták and Tatra’s former U.S. director general Ronald Adams are being tried by a Czech court and some former Tatra managers are witnesses.

The trial is to continue in mid-March by the questioning of Tatra’s former U.S. branch manager Duncan Sellars and William Cabaniss, former U.S. ambassador to the Czech Republic and a member of Tatra’s supervisory board, Právo adds.

Read more: http://www.praguepost.com/economy/37613-tatra-trucks-to-return-to-indian-market#ixzz2vDKqk6E2
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Union Steel Minister Beni Prasad Verma has virtually opened a can of worms for Samajwadi Party (SP) chief Mulayam Singh Yadav just before the Lok Sabha election. He alleged here on Saturday that as defence minister, Mulayam played a crucial role in renewing the Tatra truck deal in which crores of rupees are alleged to have been given to top Indian Army officials and politicians.

Addressing reporters in Lucknow, he said the CBI, which was probing the scam, was also looking into Mulayam’s role in the deal. He also said the spat between Mulayam and Narendra Modi was a “fixed match”.

“Mulayam should not feel too happy about the CBI closing the investigations (into the DA case) against him. The CBI is probing his role in renewing the deal. The files related to the scam are locked in the CBI’s almirah, and Rahul ji will open it (as PM),” he asserted.

The CBI had started investigations into the Tatra scam after the previous Indian Army Chief General VK Singh had alleged that he had been offered a bribe of Rs 14 crore by a top Army officer for ordering a fresh batch of the allegedly “obsolete” trucks.

The first contract for the supply of these trucks from Tatra AS of the Czech Republic to India was signed in 1986. The contract was first renewed between 1996 and 1997 for 15 years when Mulayam was defence minister in the United Front government headed by HD Deve Gowda.

http://www.dnaindia.com/india/report-beni-prasad-verma-suspects-mulayam-singh-yadav-hand-in-tatra-truck-deal-1957243

Tatra’s former US head insists Czech businessman asked for bribe

Prague, Jan 21 (ČTK) – Ronald Adams, former U.S. director general of Tatra, a lorry maker seated in Moravia, insisted before a Prague court today that Czech businessman Michal Smrž offered him promotion of a public order for Tatra in exchange of 100 million Kč in 2008.

Smrž, owner of the MPI armament company, faces criminal charges over the Tatra case along with former Czech defense minister Martin Barták. Charged with attempted fraud, Smrž could be sentenced to up to 10 years in jail. He pleads innocent.

The prosecution says Smrž tried to gain money from Tatra representatives for removing problems the company had in connection with the Defense Ministry’s order for the supply of off-road vehicles for the Czech military.

Smrž pretended he could influence the Defense Ministry and government officials. For example, he promised to stage a personal meeting of Tatra managers with the then-prime minister Mirek Topolánek (Civic Democrats, ODS).

Since he did not enjoy such influence and could not fulfill his promises, his behavior can be assessed as attempted fraud, the state attorney says.

Adams today described four meetings he had with Smrž.

The first one, initiated by Smrž, took place in Adams’ office on January 11, 2008. Smrž told Adams that he knew about problems surrounding Tatra’s public order and that he could help settle them, Adams said today.

He said Smrž spoke about a help that would require some expenses.

Another meeting, at which Smrž set the demanded sum at 100 million Kč, took place in a restaurant in Prague on Jan. 16, 2008, Adams continued.

He said he neither nodded to nor declined Smrž’s offer, because the tests of Tatra lorries were underway then and Adams could win more time by delaying his answer.

At the time, the media wrote negatively about Tatra. Politicians, reacting to Tatra’s new sub-contractor, were trying to strip Tatra of the public order, Adams told the court today.

A meeting in Brno’s Holiday Inn hotel followed on January 30, with Adams making an audio recording of it. Before, he says he told Smrž by phone that Tatra would not pay 100 million Kč to him.

The audio recording, which is of a poor technical quality and not well comprehensible, is one of the main pieces of evidence in the proceedings against Smrž and Bartak.

The aim of the audio was to try to make Smrž say who was behind the campaign against Tatra and who influenced the lorries’ testing, as the tests were going on well, except for minor shortcomings, Adams said.

That is why, he said, he sought a personal meeting with Topolánek in order to find out whether Topolánek was behind the negative campaign.

At their last meeting in Prague on March 19, Adams told Smrž that Tatra would pay nothing to him. The tests had been completed on March 3 and Adams was convinced that the supply would be approved without Tatra having to pay anything, he said today.

Barták, Smrž’s friend who was deputy defense minister at the time, is suspected of having asked a Tatra representative for a bribe of 80 million Kč in February 2008 in exchange for his promotion of the above order.

Some time ago, Bartak accused Adams of corruption. He said Adams had offered him a bribe for securing further Czech public orders for Tatra. Nevertheless, a court eventually acquitted Adams of the charges.

http://www.praguepost.com/czech-news/35423-adams-armament-company-head-asked-for-100-million-kc

Kopřivnická car always doing things differently than others and relied on the original, but expensive solution. “This must change,” he says in an interview with the weekly Economist CEO Petr Karasek.

Image courtesy of HN – George Zerzoň.

Petr Karasek (49)

Education:
- Graduated from the Technical University in Brno (road construction machinery).
- obtained his MBA from Sheffield Hallam University.
- Further graduated corporate and commercial law at the Law Faculty of Masaryk University in Brno.

Career:
- Karosa High Toll (now Iveco Czech Republic) started as a designer, then it was commercial director and board member.
- He was the director of Škoda Transportation during its restructuring.
- The Vice-President of the Czech Association of interim managers and external lecturer at the University and Technical University.
- In October, he became Director of the Tatra Kopřivnice crisis.

Privacy:
- Married, two children.

Tatra must be inspired by companies such as bus manufacturer, SOR or Zetor Brno. In the interview, which can be found in the current double issue of the weekly The Economist, it says its director Petr Karasek. For the model considered and hard restructuring Kamaz. “If it can Russian truck manufacturer, why would it not prove Tatra? Just tatrováci must stop looking in the rearview mirror,” says the manager, who sent an employee to “brigade” in High Toll to assist in the pre-Christmas peak in the production of Iveco buses and know how to work elsewhere.

At the time of execution Tatry have the automobile was extremely critical. What do you all made it here now act as a director?

Maybe that’s because I’m probably not an unqualified discussed the possibilities that greeted Tatra, I was asked by the new owners, whether’ll try to prepare a detailed analysis of the situation. After that followed a logical next step, ie the design, what would be possible with Tatra do to save and develop in the future. Shareholders proposal and assess the various options chosen just this. Naturally, you want me took responsibility for its implementation.

One of the problems Tatry was not clear that the owner and the CEO had to serve many masters. As it is now, when the two owners?

Owners are moving very consistent so far not at this point to comment.

Among Koprivnice and Mlada Boleslav – Read HERE

Develops Tatra truck for farmers, which will replace the tractor – READ HERE

And what are the main findings of your examination of the situation Tatry?

Tatra lived too look into the history and not enough willing to consider changing your way of thinking and working. In the last 20 years, suffered from frequent changes in strategy, direction, organization, and management and owners did not have clear market focus – Aimed at a wide variety of targets. The concept of products, based in the past, taken alone does not provide sufficient competitive advantage. Technology base and manufacturing processes have also correspond to current needs. At the time of its creation was thought out very well, but the world is for those 40 years much has changed. It is clear what we have to focus on.

Workers Tatry mind that your consulting team was Peter Hrdlicka, a former chief designer of the car Favorit a big critic of the original kopřivnické technical concepts with air-cooled engines?

Petr Hrdlicka for his age almost 80 years of remarkably agile. He has in mind the knowledge and experience that can be found rarely. He was an important member of our team in drafting the new strategy for Tatra, mainly in the role of the expert’s report. I never noticed that with someone in the company had a problem. I think he should Czech industry people with rich experience to appreciate more and use them. The average age in my expert team was appreciably over 60 years, for example, another prominent member of the Breslau Kulhánek recently celebrated his seventieth birthday.

Original chassis design with swinging half-axles, however, is even older. Although ensures excellent flotation, but production is expensive. Will she keep Tatra, or even in this area accede to fundamental change?

At this time, we will deal with savings in the existing approaches. One of the ways that lead to the high degree of unification of components and subassemblies. In fact, I like designer Karosa High Toll growing up and I felt that Tatra, which at first glance look like bricks, have an even higher degree of unification. But in the last two decades, it’s various ad hoc projects very dilute.

Kopřivnická automaker last year produced around 500 trucks, this year planned 800 What is reality and what is your estimate for the year 2014?

I suppose Tatra this year to sell a total of about 720 vehicles. Realistic plan for next year, during which should play a substantial part of the necessary restructuring steps, is still about the same amount. One of the first goals is to reach that tipping point from which production is profitable, still lay below. That will mean strong pressure to reduce overhead and fixed costs.

Will you lay off?

Low labor productivity and high costs per car are one of the biggest weaknesses Tatry and we very quickly rectified. We compared the productivity Zetor, with the company SOR and Bobcatem in Dobris, which are manufacturers of similar products, technology and basic processes. The first rolling target we set the productivity of one vehicle produced per employee per year, but even that would be long enough. Look, how should the productivity worked Kamaz. When he therefore was able Zetor, if he can Kamaz, why should it not prove Tatra? Just tatrováci must stop looking in the rearview mirror, and even more have to look forward to those companies that belong to the most successful. There can gain inspiration. The success story is indeed valuable, but for the future survival of nothing.

Future Tatry see that fills the gaps in the market in which the big players want. But how are customers who need some specialties even aware that there exists a Tatra and what it offers?

The vast majority of customers in these segments of the Tatra knows and follows her efforts. O such strong support from users and the public may rely few companies.However, marketing is actively preparing the necessary steps.

Expect to manufacture engines, or one will be used only imported?

Production of internal combustion engines is now much rocket science. Increasing requirements to reduce emissions, noise and consumption cause extreme development costs. To make those investments could return, are then required a series of tens of thousands of pieces. Production in smaller numbers unfortunately not sustainable.

It follows that the production of engines already in Koprivnice future count impossible. In the model also allow the company SOR, which in their buses assembles imported engines, and although it is a relatively small producer, holds a significant share of home.Are you going to cooperate with it?

We have already begun to establish contacts with SOR and Zetor, which can also offer specials, and thanks to the friendly relations we have sent employees to other companies to see that many things can be done differently and better. Kopřivnická car was due to its unique position in the past their lot. I often hear that doing a thing one way or another simply can not, because in Tatra always did after her. That needs to change.

Original interview:  http://web.volny.cz/noviny/ekonomika-a-podnikani/clanek/~volny/IDC/253753/ekonom-tatru-komplet-predelam-planuje-novy-generalni-reditel-automobilky-petr-karasek.html