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Czech Prime Minister Jiri Paroubek and Finance Minister Bohumil Sobotka are in disagreement over how to proceed with a controversial arbitration case that could cost the state 40 billion crowns (over 1.5 billion US dollars). A London court is currently handling a complaint against the Czech Republic filed by the Japanese investment bank, Nomura. Nomura claims that the Czech government failed to protect its investment when it ordered the enforced administration of the ailing IPB bank, in which Nomura had shares, and its subsequent sale to a rival Czech banking institution, CSOB five years ago. Nomura is demanding 40 billion Czech crowns in compensation.

From information received by the Czech intelligence services, Prime Minister Paroubek fears the state could lose the case and would like it to try to come to an agreement with Nomura. Mr Sobotka believes that any such agreement would violate state guarantees promised to CSOB in 2000.

The Prague Symphony Orchestra has announced it will have a new chief conductor next season. Jiri Kout is currently Chief Conductor of the St. Gallen Symphony Orchestra in Switzerland. The 67 year-old artist left Czechoslovakia in the 1970s and built a career staging operas in German theatre halls. Mr Kout began performing regularly in the Czech Republic in the mid-1990s, with one of his most recent Bedrich Smetana's My Country at last year's Prague Spring international music festival.

The Government has approved a defence ministry proposal to give Egypt 550 tonnes of ammunition that is no longer being used by the Czech Army. This saves the state 50 million crowns (a little over 2 million US dollars); the cost of its ecological disposal. Egypt asked for the ammunition in April and will cover all transport costs.

The Czech Army has 20,000 tonnes of redundant ammunition that should either be sold or given away; 46,000 tonnes will be disposed of ecologically. Only one third of the ammunition has so far been disposed of. Afghanistan and Georgia have received several thousand tonnes, while Iraq is also considered a potential candidate.

The Czech publishing house, Albatros, has announced that the official Czech version of the sixth instalment of JK Rowling's Harry Potter series is coming out on December 19. Harry Potter and the Half-Blood Prince has been in bookstores in the original English language since mid-July. A pirate Czech translation was available on the internet for a couple of weeks but taken off the web following complaints by Albatros, which has exclusive ownership rights to translations of J.K. Rowling's work.

On an official visit to Israel, President Vaclav Klaus expressed appreciation for the government's "groundbreaking peace initiative" saying that Israel's withdrawal from the Gaza Strip had restored faith in the Middle East peace process and that it was now up to the Palestinian leadership to show goodwill. Meeting with the Israeli President Moshe Katsav, Mr. Klaus said that the Czech Republic would support a balanced approach to the Israeli-Palestinian conflict in the European Union.

A study commissioned by the Czech Chamber of Dentists suggests that in the next 15 years the number of dentists in the Czech Republic could drop by a third, unless medical schools receive more money from the state. The 100 or so graduates every year cannot make up for those who retire. Also many young dentists leave for EU countries where they get paid much higher salaries.

Prime Minister Jiri Paroubek has denied that a change of leadership within the Communist Party is to open the way for a coalition with the Social Democrats after next year's general elections. Mr. Paroubek told journalists that if his party should win the elections then he would favour either a coalition with the Christian Democrats, a grand coalition or a minority government. The Prime Minister said that the Communist Party would have to change more than its leader in order to open the way for closer cooperation.

A new court ruling has once again reversed the decision on the ownership of Opocno Chateau in Eastern Bohemia. According to the Rychnov district court the chateau belongs to the National Heritage Institute, thereby the state. Two earlier court rulings returned the chateau to the last private owners, the Colorado-Mansfeld family, but the Constitutional Court abolished both verdicts in January, bringing the restitution suit back to square one. The property was confiscated on the grounds of the post war Benes decrees and the Colorado Mansfeld family has battled since 1995 to get it back. The case hinges on whether the former owner Collorado Mansfeld was a Czechoslovak citizen and whether he collaborated with the Nazis.

One of the two smaller parties in the ruling coalition, the Christian Democrats, have said they will not support the removal from office of the Supreme State Attorney Marie Benesova proposed by the Justice Minister Pavel Nemec of the Freedom Union. The Christian Democrats say they are convinced that politicians must not influence decisions in criminal cases. Relations between Ms Benesova and Mr Nemec have been tense for several months because of certain criminal cases and the crisis culminated a few days ago when Minister Nemec launched disciplinary proceedings against the Supreme State Attorney.

The chairman of the opposition Communist Party, Miroslav Grebenicek, has decided to step down from his post. In a statement for the CTK news agency, Mr Grebenicek said his staying at the head of the party would be pointless, stating the party's programme orientation as the main reason of his move. A spokesperson for the Communist Party said that until October 1 when his case will be discussed by the Central Committee, Mr Grebenicek will not talk to the media. The 58-year old Miroslav Grebenicek has been chairman of the Communist Party since 1993.