Subsection (2) below shall have effect for the purpose of applying paragraph 3(b) of Part IV of Schedule I to the Trustee Investments Act 1961 (which provides that shares and debentures of a company shall not count as wider–range and narrower–range investments respectively within the meaning of that Act unless the company has paid dividends in each of the five years immediately preceding that in which the investment is made) in relation to investment in shares or debentures of an operating company during the calendar year in which the transfer date falls ("the first investment year") or during any year following that year.
The company shall be deemed to have paid a dividend as mentioned in the said paragraph 3(b)—
In subsection (2) above "the relevant five years" means the five years immediately preceding the year in which the investment in question is made or proposed to be made.