The costs of appeal are assessed against the plaintiffs.

Article 94(1)3 and (c) of the former Income Tax Act (amended by Act No. 9897 of Dec. 31, 2009) (hereinafter “instant provision”) stipulate “income generated from the transfer of stocks or equity shares (including preemptive rights) of a corporation which is not a stock-listed corporation” as one of the taxable objects of capital gains tax.

For the reasons indicated in its holding, the lower court: (a) citing the first instance judgment, acknowledged the facts as indicated in its holding, including the fact that the Plaintiffs held shares in the Turkey Co., Ltd. by converting them into the instant securities depository receipts through foreign depository institutions and transferred them to foreign investors, etc.; (b) 1) The real owner of securities depository receipts may exercise voting rights to original shares through depository institutions and receive dividends; and (c) upon applying for termination of the securities depository receipts, the principal owner may exercise voting rights directly upon receiving shares; and (d) the principal owner shall be deemed to transfer the original shares through deposit in the case of the securities depository receipts involving the so-called financing flow; (b) in the case of the securities depository receipts involving the so-called “securities depository receipts through stock conversion,” the original shares owner is deemed to hold the securities depository receipts; and (c) if the original shares owner who deposited the original shares transfer the securities depository receipts to foreign investors, it shall be deemed that the original shares were transferred in the process of the transaction; and therefore, it is reasonable to view that the instant shares were transferred to the foreign investors, etc.