relocated merely because property used in such manufacturing was not relocated. (C) Relocation of not less than equivalent productive capacity required For purposes of subparagraph (A), manufacturing shall not be treated as relocated unless the property manufactured in the United States is substantially identical to the property previously manufactured in a foreign country and the increase in the units of production of such property in the United States by the qualified manufacturer is not less than the reduction in the units of production of such property in such foreign country by such qualified manufacturer. (7) Application to possessions of the United States For purposes of this subsection, the term United States includes any possession of the United States. . (b) Exclusion of gain on disposition of property in connection with qualified relocation of manufacturing (1) In general Part III of subchapter B of chapter 1 of such Code is amended by inserting after section 139H the following new section: 139I. Exclusion of gain on disposition of property in connection with qualified relocation of manufacturing (a) In general In the case of a qualified manufacturer, gross income shall not include gain from the sale or exchange of qualified relocation disposition property. (b) Qualified relocation disposition property For purposes of this section, the term qualified relocation disposition property means any property which— (1) is sold or exchanged by a qualified manufacturer in connection with a qualified relocation of manufacturing, and (2) was used by such qualified manufacturer in the trade or business of manufacturing a qualified medical product in the foreign country from which such manufacturing is being relocated. (c) Other terms Terms used in this section which are also used in subsection (n) of section 168 shall have the same meaning when used in this section as when used in such subsection. . (2) Clerical amendment The table of sections for part III of subchapter B of chapter 1 of such Code is amended by