What is the effect of this law?

It prohibits PAC-to-PAC transfers:  a political action committee from making a contribution to any other political action committee.

The only exception will be to allow a political action committee that is not a principal campaign committee to make a contribution to a principal campaign committee.  So 136PAC can give to John Doe for House PAC, but not the other way around.

Why is this important?

PAC-to-PAC transfers allow lobbyists and other special interests to launder money through several PACs to conceal its true source.  This is one the most powerful tools that special interests use to keep a stranglehold on elected officials without the public ever knowing it.

This will make the campaign finance process more transparent.  When the process is more transparent, it will bring about greater trust among the people and allow voters to make more informed election decisions.