Wednesday, January 31, 2001
Citizen Regecova
Salon owner hinders one of country's largest foreign investments
By Leah Bower
All Marketa Regecova says she wants is to cut hair, raise her child and live a quiet life in Drahotuse, the rural north Moravian town where she was born.
But simple negotiations over land prices have thrown the 28-year-old hairdresser into the national spotlight -- and into the middle of a battle of wills between hopes for a town's economic rebirth and for the fair treatment of average citizens.
Regecova owns a 1-hectare (2.4-acre) piece of land in nearby Hranice. It's the last chunk of a 50-hectare parcel that town officials assembled for Dutch giant Royal Philips Electronics. Philips has begun construction of a factory at the site, but officials worry that Regecova's refusal to sell might hamper the company's future projects.
Regecova said Hranice officials initially offered her neighbors significantly more for their land. All she ever wanted was the same. The negotiation has turned into a standoff that has dragged on since June.
In the course of it, Regecova says she has been investigated for fraud, her parents have been told she might be thrown in prison, and her mailbox and phone lines have been flooded with everything from notes of encouragement to callers saying she is a "greedy cow."
"I was pulled into this situation and have been living it for eight months," says Regecova, getting up to tend to a client. Six gold rings flash as she snips and combs his gray hair. "I am trying to stand up to the pressure and am always trying to decide if [the city] is wrong or if they are right."
The battle has set tongues wagging throughout the two neighboring towns, where life is pleasantly slow but jobs are scarce. The region was hit hard by a three-year economic downturn, and Hranice's unemployment rate now hovers around 15 percent. Some are bitter that Regecova would jeopardize the 3,000 jobs promised by Philips.
"Somebody should slap her in the face," snapped a 78-year-old Hranice man walking near the town's square, who declined to give his name. "If there were more people like her there would be no Philips plant here."
His wife nodded in agreement.
"She's greedy," she said.
Massive investment
Philips' project is one of the largest foreign investments in Czech history. The government dangled record incentives to lure the company, including a 10-year corporate tax break and 1.65 billion Kc ($44.5 million) in subsidies. Competition was fierce as Philips considered 66 sites in Hungary, Poland, Slovakia and the Czech Republic. This country's victory was symbolic after years of being passed over by foreign investors.
Philips is expected to spend 605 million euros ($559 million/21 billion Kc) on the project. Construction on the factory's first phase will be complete by mid-year, and it will initially employ 1,000 people. Eventually more than 3,000 workers will manufacture 2.5 million jumbo and flat television screens each year.
Hranice Mayor Rudolf Novak said the Philips jobs also will stimulate creation of thousands of additional jobs -- catering, cleaning and construction, among others. It also will mark a shift in the region's economic base away from smokestack industries, such as engineering and heavy manfacturing, to cleaner, high-tech factories.
"This investment can influence the lives of half a million people in central and northern Moravia," Novak said when Philips first announced it was coming to town.
But Hranice's rosy dreams hit a roadblock when officials approached Regecova, one of 97 landowners on the Philips site. She says she was offered 105 Kc a square meter for her land. She countered with an offer of 150 Kc, a request she didn't think was unreasonable, since she heard neighbors were offered as much as 300 Kc.
The city wouldn't go for it and told her they decided they didn't need the land.
She then saw officials trumpeting that it had all the land Philips would need. So she found a company called Pimex, which bought her land for less than market rate, and in return, agreed to help her reconstruct the 100-year-old building her salon is in.
This incensed town officials, who filed charges of fraud, tax evasion and abuse of commercial negotiations.
All three charges were investigated and dismissed, said Lenka Sromova, a state representative for the Regional State Office in Prerov.
"The city was just pretending it didn't want to buy her land because they were trying to force her to sell for 105 Kc," said Regecova's Prague lawyer, Petr Ksada. "And the accusations only had one goal, to scare her and pressure her into selling the land."
Regecova said Novak even paid a visit to her parents.
"He told them he had filed a lawsuit accusing me of fraud and tax evasion," she said. "He was trying to get them to pressure me, telling them I could be put in prison for eight to 10 years."
The city also tried two other legal approaches, a lawsuit to cancel her deal with Pimex and a lawsuit to force her to sell the land. A court dismissed both suits.
Novak wouldn't talk to The Prague Post, but said in a written statement that Regecova essentially was demanding public money that isn't hers.
"We are sorry to say that at this point, the whole problem puts in danger not only the completion of the biggest investment by Philips in the world, but also the Czech Republic's reputation as a legal and democratic state, as well as future investment," he said.
Regecova sees the benefit that would come with the Philips plant, and she says she never meant to stand in its path. But she said she also doesn't want to be bullied and deserves to get a fair price.
And after the treatment she's received from town officials, she says she isn't in a negotiating mood.
Many say it's simply not a wise battle to pitch with a company that could bring so much good to the area.
"It is greediness. It is capitalism," said retired metal worker Zdenek Vaclavik of Regecova's decision. "Our economy is dependent on investors."
Taking a stand
To many, Regecova's battle is less about blocking one of the largest foreign investments in Czech history and more about standing up to public officials, who many say aren't far removed from the oppressive leaders who governed the country in the not-so-distant past.
"[The mayor's office] does what it wants to, just like in communist times," said a local shop owner, who was afraid of the repercussions for his business if he gave his name. "I think it is necessary to put things in order at the mayor's and not here at Mrs. Regecova's."
Regecova has become a symbol of protest against public officials who many still see as arrogant and abusive of their power, the same spirit that led thousands to hold vigils in Wenceslas Square and outside the Czech Television building over questions of political influence in public TV.
"Especially after this attracted a lot of media attention, many people called me and say I am doing the right thing and should not give up," she said. "They say officials and mayors should not treat citizens like this. These phone calls help me endure the situation."
Though people don't make comments to her face when she walks through town, Regecova said she knows it's a big topic of discussion.
"Sometimes guys talk about it in the pub and they don't agree with it," she said. Then there are the phone calls.
"They don't just say 'Mrs. Regecova, you are wrong,'" she said. "They say 'You greedy cow...you will never enjoy that money.' Some people wish me to go bankrupt because they think I'm bad, or they wish me to end up as a cleaning lady at Philips. They say I rob every citizen, how can I do this with all the sick and poor people in the country. Some of it can't even be publicized."
She's received calls from as far away as Liberec, Pardubice, Brno and Prague.
The town has come back to Regecova, offering her 300 Kc a square meter for her land, but now she and her lawyer are asking for 1,500 Kc.
She is also now asking for 500,000 Kc for slanderous statements made by Novak and 5 million Kc in compensation for the fact that Pimex withdrew from its deal with her after it was visited by the town hall.
If she happens to win her lawsuit, it could be difficult for Regecova to continue living the quiet life she had hoped for in her village, where her brother, sister and parents still live.
But Regecova said that's OK.
"I am certain of one thing," she told Czech daily Mlada fronta Dnes. "I have been cutting, cutting and cutting hair here for 10 years. I want to continue cutting hair here no matter what happens."
Leah Bower's e-mail address is lbower@praguepost.cz
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