(1) Section 831B of the Principal Act is amended -

(a) in subsection (1) -

(i) by the substitution of the following definition for the definition of "relevant subsidiary":

"'relevant subsidiary', in relation to a relevant distribution, means a company that -

(a) is, on the date on which it makes the relevant distribution -

(i) by virtue of the law of a relevant territory, resident for the purposes of foreign tax in the relevant territory, and

(ii) not generally exempt from foreign tax,

(b) throughout the relevant period -

(i) was -

(I) by virtue of the law of a relevant territory, resident for the purposes of foreign tax in the relevant territory, and

(II) not generally exempt from foreign tax, or

(ii) was resident in the State,

(c) did not, at any time during the reference period, make an excluded acquisition, and