Article 18 of Decree-Law No. 157 of 2024 mandates that transactions between related entities must adhere to the arm's length standard for determining net income. This standard is met when the financial and commercial conditions of such transactions are comparable to those between independent entities in similar circumstances. If this principle is not observed, the Kuwait Tax Department is authorised to recalculate the net income based on the appropriate arm's length price. Forthcoming executive regulations will provide specific controls for identifying related entities and detail the approved methods for calculating the arm's length price.