The meaning of oligopolistic stockholders who assume the secondary tax liability of a corporation

In order to impose secondary tax liability on the shareholders of a corporation pursuant to subparagraph 2 of Article 39 of the Framework Act on National Taxes, it is necessary to have an oligopolistic shareholder in a position to substantially control the operation of the corporation, and on the sole basis of the reasons registered as shareholders in the register of shareholders of the corporation in the form of a corporate registry, it cannot be said that the

Article 39 subparagraph 2 of the Framework Act on National Taxes

Supreme Court Decision 80Nu403 Decided January 13, 1981, 82Nu8 Decided September 28, 1982, 82Nu607 Decided January 24, 1984, 85Nu55 Decided May 28, 1985, 85Nu63 Decided June 11, 1985

Plaintiff

Head of Yongsan Tax Office

Seoul High Court Decision 84Gu1101 Decided December 4, 1985

The appeal is dismissed.

The costs of appeal shall be borne by the defendant.

The defendant's grounds of appeal are examined.

Article 39 subparagraph 2 of the Framework Act on National Taxes requires that an oligopolistic shareholder who is an oligopolistic shareholder and is in a position to substantially control the operation of the legal entity. However, the fact that the shareholder registry of a legal entity is registered as a shareholder in the form of an oligopolistic shareholder does not immediately require a member to pay taxes (see, e.g., Supreme Court Decisions 80Nu403, Jan. 13, 1981; 82Nu82, Sept. 28, 1982; 83Nu607, Jan. 24, 1984; 85Nu55 and Jun. 11, 1985; 85Nu63, Jun. 11, 1985). The court below found that the non-party, based on macro evidence, did not have any authority to register the legal entity as an oligopolistic shareholder in the form of the above shareholder registry or the company's oligopolistic shareholder registry in order to meet the above requirements for the establishment of the non-party corporation as a director.

Therefore, the appeal is dismissed, and the costs of the appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Shin Jong-sung (Presiding Justice)