Understanding the Arm’s Length Principle (ALP)
Lexicon Entry: Transfer Pricing Standard under Article 34
Feb 17, 2026
5 min read
Arakan Statutory Team
The **Arm’s Length Principle (ALP)** requires that transactions between "Related Parties" be priced as if they were between unrelated, independent entities.
Forensic Benchmarking
The FTA utilizes the OECD standard for ALP. Arakan’s engine verifies ALP by comparing internal transaction metadata against sovereign benchmarking data to flag "Transfer Pricing Drift" before audit.