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Michael Mc Auliffe, another Australian, was hanged in Kuala Lumpur in 1993 after being found with heroin in his pocket at a Penang airport checkpoint.
Malaysian government officials say despite the law change giving judges discretionary powers on capital punishment, authorities are not going softer on drug trafficking."We do not want the judges' hands tied," said Azalina Othman Said, a minister in the prime minister's department.
Abdullah told reporters after the verdict the case was "clear cut".
Shafee said Exposto is a "responsible mother" who told him she is so anti-drugs that if her four children ever got involved in drugs she would kill them herself.
After the acquittal, Exposto was sent back to jail on Wednesday night.
Lawyers said her passport had expired while she was awaiting trial and they would apply for another from the Australian embassy in Kuala Lumpur.
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Malaysia has hanged more than 440 convicted drug offenders since 1960.