The principal Act is amended by inserting, immediately after section 132E, the following new sections 132F and 132G:
"Exception and definition.
132F. Section 132E shall not apply to an arrangement or transaction for the acquisition or disposal of a non-cash asset entered into-
(a) by a company-
(i) and any of its wholly-owned subsidiaries; or
(ii) and its holding company which holds all the issued shares of the company; or
(iii) which is a wholly-owned subsidiary of a holding company and another wholly-owned subsidiary company of that same holding company; or
(b) by a company which is being wound up, unless the winding up is a members' voluntary winding up; or
(c) by a company which is an acquisition or disposal of an asset in the ordinary course of business of the company and is on terms not more favourable than those generally available to the public or employees of the company; or
(d) by a company if such arrangement or transaction does not involve transfer of cash or property and which shall have no effect unless approved at a general meeting or by a relevant authority.
Prohibited transaction involving shareholders and directors.
132G. (1) Notwithstanding the provisions of sections 132C and 132E, a company shall not enter into any arrangement or transaction to acquire the shares or assets of another company in which a shareholder or director of the acquiring company, or a person connected to such shareholder or director has a substantial shareholding as defined in section 69D whether or not for the benefit of such shareholder, director or connected person or for any other person unless the arrangement or transaction was entered into three years after such shareholder, director or connected person as the case may be, first held the shares in that other company or after the assets were first acquired by the said company, as the case may be.
(2) An arrangement or transaction entered into in contravention of subsection (1) shall be void and any consideration given for the shares or assets shall be recoverable accordingly.
(3) Subsection (2) shall apply to any arrangement or transaction which is pending completion at the time of coming into force of this section.
(4) For the purposes of this section, a "person connected with a shareholder" shall have the same meaning assigned to a "person connected with a director" in section 122A with the word "shareholder" substituted for the word "director".
(5) If there is any contravention of this section, the acquiring company and every director of the said company shall be guilty of an offence against this Act save in respect of any arrangement or transaction which is pending completion at the time of coming into force of this section.
Penalty: Imprisonment for three years or fifty thousand ringgit or both.".