A. The Plaintiff is a company established by the Tentieth Eury International Corporation (hereinafter “FOX”) of the United States for the purpose of importing and distributing movies in the Republic of Korea.

B. On September 1, 1997, the Plaintiff entered into a license agreement relating to film distribution activities in the Republic of Korea with the FOX, and the license agreement was entered into on October 1, 2002 with the same content as TF HU LC (hereinafter “TF”). As the license agreement was changed into TF HF HU LC, the Plaintiff entered into a license agreement (hereinafter “instant agreement”).

C. According to the instant contract, the Plaintiff, as Licse, is obligated to pay royalties calculated by the following methods to the TF, which is the Licensor:

Ratti = Total sales amount of the Plaintiff - Distribution commission - Direct distribution expenses (specific contents of each item shall be deemed to be followed).

D. From July 5, 2001 to January 17, 2005, the Plaintiff imported film (import declaration number 20138-01-00070999, et al., hereinafter “the instant goods”) from FOX or TF, and reported and paid the value-added tax on the royalty to the Defendant, who is the customs collector, at a provisional dutiable value. After the Plaintiff’s total sales and payment are confirmed, the Plaintiff sent royalties under the instant contract to TCF, and settled the value-added tax by reporting the finalized price.

E. Around July 3, 2006, the Defendant deemed that the dutiable value of the instant goods was added to the royalty amount that the Plaintiff remitted to TF and notified the Plaintiff of the total amount of value-added tax totaling KRW 2,775,670,820 and the total amount of penalty tax totaling KRW 549,168,610,610, as stated in the attached list “the first disposition” column for “the first disposition” from July 3, 2006 to August 4, 2006.

F. The Plaintiff, who is dissatisfied with the above corrective disposition, filed a tax appeal with the Tax Tribunal on September 28, 2006.