(1)
A company involved in an arrangement with a related party shall —
(a)
ensure that the terms and conditions for which the arrangement is carried out is at arm's length ; and
(b)
report the arrangement in the form and manner prescribed by the relevant tax authority.
(2)
Where, in the opinion of a relevant tax authority, a company has entered into an arrangement with a related party which is not at arm's length, it may effect necessary adjustments to bring the arrangement in conformity to arm's length terms as provided under the Transfer Pricing Regulations.
(3)
The relevant tax authority may make rules or regulations for the administration of this section.
(4)
For the purposes of this section —
(a)
an "arrangement" includes any agreement, understanding, scheme, financial or commercial relation, transaction or series of transactions ; and
(b)
"arm's length terms and conditions" means such terms and conditions obtainable if the transaction or arrangement was between unrelated parties dealing in comparative circumstances.