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The section in question has been renumbered; it's the section on sml:targetRequired, which in the draft of 6 August has the number 3.3.2.2 and the anchor "#sml_targetRequired".
Discussed at 2007-08-29 F2F. The WG decided not to make the suggested change, and require that targetRequired need to be enforced for null references. (And empty references carry no special meaning and is no longer a distinct term.)