2. The costs of the lawsuit are assessed against the defendant.

Cheong-gu Office

The same shall apply to the order.

A. AA owned 100% of the shares of ******** (BB Hong Kong) on January 26, 2011, and BB Hong Kong owned 100% of the shares of *********** Limited Corporation (hereinafter referred to as “CCC”) and****** Limited Corporation (hereinafter referred to as “DD injury”).

B. On January 26, 2011, the Plaintiff entered into the instant contract with the AA and BB Hong Kong (hereinafter referred to as the “instant contract”). The main content is that with respect to each share of CCC and DD injury, BB Hong Kong is a shareholder under the name of BB Hong, the Plaintiff and AAA are beneficial owners, and the shares owned by the Plaintiff are 80% of CCC shares, 60% of DD injury shares, and shares owned by AA are 20% of CCC shares and 40% of DD injury shares.

“. The Defendant: (a) deemed that the Plaintiff acquired shares of 80% of CCC shares and 60% of DD injury shares (including shares corresponding to each of the above shares) free of charge pursuant to the instant contract (the Defendant did not specify who is the donor); (b) decided and notified the Plaintiff of KRW 6,302,442,050 (including penalty tax) of gift tax on November 4, 2013 (hereinafter referred to as the “disposition”); (c) [Grounds for recognition] without dispute; (d) evidence Nos. 1 through 13 (including branch numbers; hereinafter the same shall apply); and (d) evidence Nos. 1 through 5, and the purport of the entire pleadings and the purport of the entire pleadings.

2. Whether the instant disposition is lawful

(a) Facts of recognition;

1) EE Co., Ltd. (hereinafter “EE”) was established in around 1993 and engaged in steel trade business.

2) The Plaintiff, the largest shareholder of the EE, and the representative director, was the FF, at the time of establishing a shipbuilding yard in Thailand, proposed the establishment of a Chinese subsidiary to AA and GGG Co., Ltd. (hereinafter referred to as “GGGG”). On February 5, 2007, EE, BB Hong Kong, and GG agreed to jointly operate the above business by investing 150,000 USB respectively in the capital of BB Hong Kong, with the aim of facilitating the export and import of steel products, etc. and creating profits from securing raw materials, respectively, on 150,000 for the purpose of the business, and agreed to jointly operate the said business, and after the settlement of each year, the amount of the investment of EE and GG was 150,000, increased by 150,000, and agreed to be 60,000,000 US dollars in total from 20,000,000 among the instant contracts.

3) Meanwhile, AA established the CCC on February 25, 2007, and September 4, 2007, respectively, in China. The Plaintiff was in charge of the business activities related to the CCC (hereinafter “existing business activities”) after the said investment, and performed the advisory services for DNA injury.

4) As the business interests of a Chinese subsidiary were not allocated from AA to the Chinese subsidiary, GG was refunded 600,000 USD and interest 35,812 USD around March 2008, and EE was refunded 450,000 USD around March 2009 (the shares of the Plaintiff and EE Hong Kong were returned on August 17, 2010).

5) The Plaintiff requested AA to distribute profits and shares in Chinese subsidiaries (hereinafter referred to as “instant profit distribution”), but rejected, and suspended sales-related business operations of CCC around June 2009. After which CCC’s sales have decreased by 20% and returned to the enemy since 2010.

6) On October 2010, AA requested the Plaintiff to take charge of the business affairs related to CCC and DD injury (hereinafter referred to as “after-way business activities”). The Plaintiff was punished for negotiations with CCC and DD injury share ratio with respect to the price that it would receive. As a result, on January 26, 2011, at the Hong Kong’s attorney-at-law office in Hong Kong, the Plaintiff entered into the instant contract and had it notarized.

[Reasons for Recognition] Facts without dispute, Gap evidence Nos. 14 through 36, Eul evidence Nos. 6 through 21, 24, witness AA's testimony and the purport of the whole pleadings

B. Determination

In light of the following circumstances, it is reasonable to view that the Plaintiff acquired the instant shares at a cost, as compensation for damages incurred by failure to distribute the profit of the instant case by AA, or remuneration for existing business activities and future business activities (hereinafter referred to as “the instant remuneration, in total damages and remuneration for business activities”) from AA, in light of the overall purport of the arguments as seen earlier.

① There is no special reason for AAA to donate the instant shares to the Plaintiff. In light of the fact that there is no reason to deem that the said shares were closely in a business relationship other than those in a business relationship, and that AA did not share considerable profits under the instant joint venture agreement to the Plaintiff, it is difficult to understand that the said shares were given free of charge to the Plaintiff without any consideration.

② Since EE and GG were one shareholder of BB Hong Kong after collecting investment money, both CCC and DD injury occurred. After the Plaintiff’s removal of losses from the business, the Plaintiff sought to request the Plaintiff to engage in its business activities again to meet it. During the instant joint venture agreement, the Plaintiff (a party to the instant joint venture agreement may be deemed to have been in fact an interest between the Plaintiff and AB Hong Kong in light of the ownership relationship and the status of representative director of each of the said companies, etc., and without settling the accounts according to existing legal relations, such as distribution of profit in this case, remuneration for the Plaintiff’s existing business activities, etc., it was difficult for the Plaintiff to engage in its business activities in the future.

③ When entering into the instant joint venture agreement, the Plaintiff merely agreed to handle the distribution of profits under the agreement between representatives, and did not clearly stipulate the amount of distribution, time, method, etc., and did not enter into an agreement on compensation for damages or penalty, etc. In the event of failure to distribute profits, etc., the Plaintiff considered that the Plaintiff was not liable for nonperformance of the instant profit distribution by AA. For this reason, it was necessary to keep a document clearly on the responsibilities for nonperformance of the instant profit distribution and for payment for future business activities, while receiving the proposal for future business activities, and it appears that there was a need to keep the document clearly on the responsibilities for nonperformance of the instant profit distribution and for future business activities with the aid of Hong Kong attorney-at-law.

④ If the Plaintiff did not engage in, or did not intend to engage in, the existing investment and business activities, the instant contract could not be concluded. Such an act by the Plaintiff was at least the cause of the Plaintiff’s benefits arising from the instant contract, and thus, the nature of the benefits ought to be determined accordingly. It is difficult to deem that the Plaintiff received the benefits under the instant contract, excluding such underlying relationship, and that the Plaintiff received the donation.

⑤ The AA held that it would be more helpful for the Plaintiff to achieve the purpose of entrusting its business, rather than paying a certain amount to the Plaintiff in the instant consideration, to make different profits that the Plaintiff would be entitled to, depending on the business performance of CCC and DD injury.

6. The instant contract was concluded in the form that the Plaintiff, not by acquiring the instant shares from AA or BB Hong Kong, was based on the premise that the Plaintiff and AAA are beneficial owners of BB Hong Kong. This is generally distinguishable from the content or form of the document prepared at the time of donation. In light of the circumstances as seen earlier, it seems that the Plaintiff and AA made the agreement on an equal relationship and the form that sets the respective share ratio and distributes is more substantive than that of the document prepared at the time of donation.

C. Therefore, the disposition of this case, which was issued on the premise that the Plaintiff received a donation of the shares of this case, is unlawful (the defendant did not assert or prove the ground for other disposition, and it does not proceed to the determination as to the existence of other taxable grounds).

3. Conclusion

The plaintiff's claim is justified and accepted.