Exception Subparagraph (A) shall not apply to— (i) stock of a foreign investment company, (ii) stock in a passive foreign investment company (as defined in section 1296), (iii) stock in a foreign corporation held by a United States person who meets the requirements of section 1248(a)(2), and (iv) stock in a foreign personal holding company. (C) Treatment of American depository receipts An American depository receipt for common stock in a foreign corporation shall be treated as common stock in such corporation. (c) Indexed basis For purposes of this section— (1) General rule The indexed basis for any asset is— (A) the adjusted basis of the asset, increased by (B) the applicable inflation adjustment. (2) Applicable inflation adjustment The applicable inflation adjustment for any asset is an amount equal to— (A) the adjusted basis of the asset, multiplied by (B) the percentage (if any) by which— (i) the gross domestic product deflator for the last calendar quarter ending before the asset is disposed of, exceeds (ii) the gross domestic product deflator for the last calendar quarter ending before the asset was acquired by the taxpayer. The percentage under subparagraph (B) shall be rounded to the nearest 1/10 of 1 percentage point. (3) Gross domestic product deflator The gross domestic product deflator for any calendar quarter is the implicit price deflator for the gross domestic product for such quarter (as shown in the last revision thereof released by the Secretary of Commerce before the close of the following calendar quarter). (d) Suspension of holding period where diminished risk of loss