Czech Power Split

Speaking at a key party congress, Klaus said he "definitively" yielded honorary chairmanship of the party he founded nearly 18 years ago because he could not identify with the policies of its current leadership.

He said the party abandoned its conservative ideas and has been turning into a centrist defender of business interests.

"One I know for sure that these are not the policies with which I founded and led the ODS for many years," the president told the shocked delegates.

The surprise move came amid high tensions between the president and Topolanek, his successor at the ODS helm, over the party's direction, with the rise in tensions coming when Prague is preparing to assume the European Union presidency on January 1.

While Klaus is a fierce critic of the EU, deeper European integration and bloc's reform treaty, Topolanek has urged a pragmatic and active European policy.

"When my views represent a minority it does not mean that I will be sulking and negate everything that will be agreed by everyone else," Topolanek told the congress. "That is a highly unpolitical approach. How long can such a game be played? Not very."

Topolanek signed the Lisbon Treaty on the country's behalf in December 2007 and has since backed it reluctantly as a necessary evil that opens the way for further reforms of the 27-member bloc.

While Klaus' step allows the premier to free the party from eurosceptic views, it also enables Klaus to back a potential new eurosceptic party before June's European Parliament election.

Klaus aligns himself with EU's eurosceptics

During a recent visit to Ireland, Klaus threw his support behind the eurosceptic Libertas movement of Irish businessman and anti-EU activist Declan Ganley, which successfully campaigned against the Lisbon Treaty in Ireland.

The impact of Klaus' decision will become clear Sunday when the Civic Democrats are to pick their new leadership. Topolanek faces a challenge for the top ODS post from a Klaus backer, Prague Mayor Pavel Bem.

The Civic Democrats are a senior partner in a three-party government, which has introduced several unpopular belt-tightening reforms, such as direct fees in health care, since assuming power in January 2007.

The party suffered a massive loss in October regional and Senate elections and Bem would prefer to torpedo the current center-right coalition and form a minority government, backed by the leftist opposition.

Topolanek, however, argued before the delegates that his government was the best choice at a time when the country is bracing for a sharp slowdown of its export-driven economy amid the global financial crisis.