The judgment below is reversed and the case is remanded to Seoul High Court.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. Regarding ground of appeal No. 1

A. Article 105(6) of the former Local Tax Act (wholly amended by Act No. 10221, Mar. 31, 2010) provides that “When an oligopolistic stockholder becomes an oligopolistic stockholder by acquiring a corporation’s stocks or shares, such oligopolistic stockholder shall be deemed to have acquired the relevant corporation’s real estate.” Article 120(6)8 of the former Restriction of Special Taxation Act (wholly amended by Act No. 10406, Dec. 27, 2010) (hereinafter “instant reduction or exemption provision”) provides that “Where a holding company (including a financial holding company) under the Monopoly Regulation and Fair Trade Act (hereinafter “Fair Trade Act”) becomes a oligopolistic stockholder under Article 22(2) of the Local Tax Act by acquiring the stocks of a subsidiary under the same Act or the Financial Holding Companies Act, Article 105(6) of the former Local Tax Act concerning the imposition of deemed acquisition tax shall not apply to such oligopolistic stockholder.

The legislative intent of this case, except for the subject of deemed acquisition tax, is to support corporate restructuring for the rationalization of ownership and management by granting tax benefits on the establishment of a holding company or the conversion of a holding company.

(see, e.g., Supreme Court Decision 2011Du2781, Jan. 23, 2014). Thus, even if a holding company under the Fair Trade Act was established or converted into a holding company under the Fair Trade Act, if a domestic company is newly incorporated into a subsidiary and becomes a holding company in the domestic company, it is necessary to grant tax benefits under the tax reduction and exemption clause of the instant case, as in the case of establishing a new holding company.

In addition, the general holding company will control the business.