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Central Bank of Cyprus Imposes Significant €350,000 Fine on Payabl. Cy Ltd

Central Bank Enforces AML Compliance

The Central Bank of Cyprus has sanctioned Payabl. Cy Ltd, formerly known as Powercash21 Ltd, with a fine totaling €350,000. This penalty comes as a direct consequence of the company’s failure to comply with specific provisions of the 2007 legislation governing the Prevention and Suppression of Money Laundering from Illegal Activities.

The Basis for the Decision

Grounded in Article 59 of the relevant law, the decision was finalized on September 30, 2025, following a 2020 audit. The regulatory process was conducted in strict accordance with administrative law procedures, ensuring that Payabl. Cy Ltd was afforded the opportunity to submit a defense prior to the final ruling.

Regulatory Oversight and Strategic Enforcement

In exercising its supervisory mandate, the Central Bank of Cyprus is empowered to implement administrative measures and impose penalties for lapses in compliance with applicable laws and directives. This enforcement action reinforces the bank’s strategy to promote transparency and combat money laundering within the financial sector.

Corporate Response and Future Steps

A representative of Payabl. Cy Ltd remarked that the fine pertains to an investigation conducted in 2020, linked to customer relationships from the period 2014–2018—a period during which the company had already ceased relations with those clients. The spokesperson emphasized that the current operations, leadership, and client base remain unaffected by these historical findings. Additionally, the company has significantly bolstered its AML compliance framework since then. Payabl. Cy Ltd has indicated its intention to appeal the decision before the Administrative Court, contesting the ruling as disproportionate given the historical nature of the case.

Mercedes-Benz Posts Higher Profit Despite China Slowdown

Mercedes-Benz reported stronger-than-expected second-quarter results, lifting its shares on Tuesday despite mounting pressure from Chinese automakers and a weaker outlook for sales and revenue.

The earnings provided a boost for Europe’s auto sector, where manufacturers continue to grapple with tariffs, softer demand and intensifying competition from Chinese rivals. Volkswagen, Mercedes-Benz and BMW have all accelerated restructuring efforts in response.

Cost Discipline Lifts Quarterly Profit

Mercedes-Benz shares rose as much as 5.9% following the results before trimming gains to trade 3.5% higher by 1118 GMT. The company reaffirmed its profit margin guidance for its core passenger car business after reporting an adjusted return on sales of 4.0% for the second quarter, above market expectations and within its 3% to 5% target range.

“In an environment where some automakers are ringing alarm bells on their competitive positioning, Mercedes delivered a clear and confident message,” Morningstar analyst Rella Suskin said.

Second-quarter operating profit increased 22% to €1.5 billion ($1.7 billion), despite a 3% decline in revenue. Lower administrative and research and development costs, together with strong performances from the financial services and vans divisions, supported earnings, while the results also included a €131 million gain related to the planned sale of leasing subsidiary Athlon.

China Remains The Key Pressure Point

Despite stronger profitability, Mercedes continues to face a challenging market environment. Sales in China fell 30% during the second quarter, prompting the company to abandon earlier expectations for stable car sales and group revenue. It now expects both to decline slightly from a year earlier.

BMW also lowered its outlook in June following a deeper-than-expected slowdown in China, highlighting the pressure facing Germany’s premium carmakers. At the same time, Mercedes said Chinese manufacturers are increasingly expanding into European markets, although Chief Executive Ola Kaellenius said their focus remains on higher-volume segments rather than the premium market.

“But that is not a reason to sit back and be relaxed,” he said.

Manufacturing Shift Continues

Mercedes is also reshaping its manufacturing footprint. The company said its German factories will undergo a more aggressive push toward leaner production, although it declined to provide further details while talks with labour representatives continue. Production is also being expanded in lower-cost Eastern European locations, including Hungary, where the company is increasing capacity at its Kecskemet plant, as well as in Poland.

Chief Financial Officer Harald Wilhelm said the full-year margin for the passenger car division is expected to come in at the lower end of the company’s guidance range, reflecting a higher share of electric vehicle sales in Europe, which remain more expensive to produce and continue to weigh on profitability.

“We must continue to work flat out to reduce costs so that we can remain competitive on the prices of our products,” Kaellenius said.

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