(1) The Principal Act is amended -

(a) in section 243 by substituting the following for subsection (8):

"(8) Subject to subsection (9), subsection (7) shall not apply to any payment of interest on a loan to a company if -

(a) subject to subsections (2A), (4), (4A) and (4E) of that section, subsection (2) of section 247 applies to the loan, and

(b) the conditions specified in subsection (3) of section 247 are fulfilled.",

(b) in section 247(1)(a) in the definition of "material interest" by substituting "company;" for "company.",

(c) in section 247(1)(a) by inserting the following definition after the definition of "material interest":

"'trading stock' has the same meaning as in section 89.",

(d) in section 247(1)(b) by substituting "subsections (4A) and (4E)" for "subsection (4A)",

(e) in section 247(2) by substituting the following for paragraph (b):