Daejeon District Court 2012Guhap3257 ( October 15, 2014)

On the ground that the Plaintiff withheld income tax on the research grants, it does not necessarily mean that the instant compensation should be regarded as income subject to taxation.

The instant compensation is a compensation paid to the Plaintiff’s employees, and it is reasonable to deem that its nature is an employee’s invention compensation pursuant to Article 15 of the Invention Promotion Act, and the instant compensation for retirement workers should also be deemed as the same as the above

Article 12 (Non-Taxable Income)

2014Nu29 Revocation of disposition to collect income tax, etc.

AAA Research Institute

BB Head of the Tax Office (CCC Head of the Tax Office before correction)

Daejeon District Court Decision 2012Guhap3257 Decided January 15, 2014

August 21, 2014

November 20, 2014

1. The defendant's appeal is dismissed.

2. The costs of appeal shall be borne by the Defendant;

Claim: The defendant shall revoke all the dispositions listed in the attached Table 1 that the defendant made against the plaintiff.

The purport of appeal: Revocation of the judgment of the first instance. The plaintiff's claim is dismissed.

1. Details of the disposition;

A. The Plaintiff is a government-funded research institute established with the main purpose of research on the fields of science and technology, such as broadcasting and communications, media research and development, SW, content, and IT, pursuant to the Act on the Establishment, Operation and Fostering of Government-Funded Science and Technology Research Institutes

B. From 2006 to 2010, the Plaintiff succeeded to the invention of the research and development outcomes of patent rights, etc. in the course of performing duties under each of the above projects, and entered into a license agreement with an enterprise that intends to use, produce, etc. the outcomes of the research and development, and paid part of the royalties paid as compensation to the researcher, employee, or retired employee registered as the inventor in the application or Patent Gazette under Article 16 and Article 17 subparag. 1 of the Intellectual Property Management Guidelines (hereinafter “instant compensation”), which are the Plaintiff’s internal rules, and paid as compensation for implementation under Article 16 and Article 17 subparag. 1 of the Patent Act (hereinafter “instant compensation”), and did not withhold income tax.

C. However, around August 2011, the Board of Audit and Inspection notified the Commissioner of the National Tax Service of the collection of royalties from non-profit organizations, such as the Plaintiff, in return for the provision of research and development outcomes to enterprises, etc., and of royalties, bonuses, etc. paid to participating researchers, etc. on the grounds that the employee invention compensation and nature of the invention invention compensation under the Invention Promotion Act fall

D. Accordingly, on September 27, 2011, and October 1 of the same year, the Defendant corrected and notified the Plaintiff of the total amount of OOO and the total amount of other income tax on the employed and retired employees, as shown in the separate sheet No. 1, OOO and corporate tax (additional tax due to failure to submit a statement of payment) (hereinafter “instant disposition”).

E. On November 14, 201, the Plaintiff appealed to the Tax Tribunal, but the Tax Tribunal dismissed the Plaintiff’s request on June 28, 2012.

[Basis] Facts without dispute, Gap evidence 1 to 54, Gap evidence 2, Eul evidence 1 to 5, Eul evidence 2-1 to 2, Eul evidence 2-1 to 44, Eul evidence 3-1 to 3-5, and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The parties' assertion

1) The plaintiff's assertion

The instant compensation constitutes an employee’s invention compensation under Article 15 of the Invention Promotion Act, which is other income subject to non-taxation provided for in subparagraph 5 (d) (i) of Article 12 of the Income Tax Act, since the Plaintiff’s researchers transferred the patent right, etc. for the employee’s invention originally acquired to the Plaintiff as the employer according to the Plaintiff’s internal regulations.

Therefore, the instant disposition taken on the premise that the instant compensation is subject to income subject to taxation shall be revoked as it is unlawful.

2) The defendant's assertion

The instant compensation constitutes an employee’s invention compensation under Article 15 of the Invention Promotion Act, not an employee’s invention compensation under Article 15 of the same Act, and thus, the instant disposition is lawful.

A) An employee’s invention compensation under Article 15 of the Invention Promotion Act is recognized in cases where an employee acquires an employee’s right to obtain a patent, etc. on the employee’s invention in the event of an employee’s invention, and an employee succeeds to and acquires the employee’s right to the employee’s invention or related patent rights from the employee, etc. on the premise that the employee acquired the right to obtain a patent, etc. on the employee’s invention, and the ownership of the national research and development outcomes obtained from a non-profit research institute as a result of the performance of the government’s contributions from the Plaintiff is attributed to the Plaintiff as the research institute under Article 20(2) of the Regulations on the Management, etc. of National Research and Development Projects (hereinafter “National Research and Development Project Management Regulations”). Therefore, even if the employee’s employee invention was made by the Plaintiff, the Plaintiff’s right to the employee’s invention or intellectual property right to the employee’s invention shall be deemed to have been acquired at his own

B) Since the Plaintiff entered into a license agreement with an enterprise, etc. and paid part of the royalties to a participating researcher not described as an inventor in the application or the Patent Gazette, it constitutes a research incentive rather than a compensation paid in return for the transfer of patent rights, etc., income tax is withheld on the amount paid by the Plaintiff to his/her employees under the same ground provision, while paying the amount to his/her employees in accordance with the same ground provision. The other income listed in subparagraph 5 of Article 12 of the Income Tax Act refers to temporary and contingent income due to its nature, and even if the formal title of income is consistent with those listed in subparagraph 5 above, if it occurred in the process of carrying out a project continuously and repeatedly, such income is not a temporary and contingent income, and if it falls under the non-taxable business income of the Plaintiff, it should be included in the non-taxable business income of the Plaintiff under Article 15 of the Income Tax Act, and the non-taxable other income constitutes a non-exclusive license under Article 15 of the Invention Promotion Act (the non-exclusive license under Article 15 of the Income Tax Act).

B. Relevant statutes

Attached Table 2 shall be as stated in the relevant statutes.

(c) Fact of recognition;

1) Plaintiff’s internal rules relating to the instant compensation

The plaintiff's internal regulations related to the compensation of this case are "Guidelines for Intellectual Property Management", "Personnel Regulations", "Guidelines for Personnel Management", and "Guidelines for Payment of Technical Compensation", and the detailed contents of the relevant regulations are as shown in attached Table 3.

2) Grounds for the payment of the instant compensation

A) The Intellectual Property Management Guidelines defines that “the creation of a creator’s work belongs to the Plaintiff’s work scope and the act of creation falls under the Plaintiff’s work while in office, and includes an employee’s invention and work creation.” (Article 2 subparag. 7), and defines that “an employee’s invention falls under the Plaintiff’s work and the act of creation falls under the Plaintiff’s work while in office” (Article 2 subparag. 9).

B) In addition, the Guidelines for Intellectual Property Management provides that when the plaintiff succeeded to the right arising from the creation of the creator's duties, compensation for implementation, special compensation, and registration compensation shall be paid to the creator (Article 16). In such a case, the payment of compensation for implementation shall be made in accordance with the standards for payment of research grants provided by the personnel regulations (Article 17 subparagraph 1), and the personnel regulations (Article 8-1, 2), which are the internal regulations of the plaintiff, (Article 75, 76), which are the personnel regulations of the plaintiff, (Article 8-1, 2) shall include the retired person and the contributor on the basis of royalties (Article 75, and

3) Method of calculating the instant compensation

A) Article 17 subparag. 1 of the former Guidelines for the Management of Intellectual Property (amended by Act No. 910, Jan. 1, 2009; hereinafter “former Guidelines for the Management of Intellectual Property Rights”) provides that the standards for payment of compensation to be paid pursuant to Article 17 subparag. 1 of the former Guidelines for the Management of Intellectual Property (amended by the former Guidelines for the Management of Intellectual Property) shall be in accordance with the standards for payment of research grants stipulated in the personnel regulations, and the calculation of the payment rate of individual payment standards shall be in terms of creative shares. Article 75(1)2 of the former Regulations on the Management of Intellectual Property provides that the amount of royalties that the Plaintiff has used is 50% or more of the amount of royalties received through the transfer or implementation of intellectual property rights, and on the other hand, the employee’

The compensation in this case = Revenue from royalties ¡¿ Ratio prescribed by Article 75 (1) 2 of the Personnel Regulations (at least 50%) ¡¿ Shares created by each individual stated in the invention report.

B) As the guidelines for the payment of technology implementation compensation were established on January 1, 2009, the provisions on the calculation of technology implementation compensation were integrated into the guidelines for the payment of technology implementation compensation. Accordingly, the personnel regulations, personnel management guidelines, intellectual property management guidelines, etc. were amended, but only the location and structure of the regulations were changed, and the detailed calculation method of the instant compensation before and after 2009 is the same.

4) Payment of research grants other than the instant compensation

On the other hand, Articles 72 and 76 of the Personnel Regulations provide that research grants shall be paid to regular employees, contract employees, and executive officers who have contributed directly or indirectly to research execution. Based on this, the plaintiff is not a creator, but a research grants shall be paid to a person who has contributed to research execution.

[Basis] Facts without dispute, Gap's evidence 3, 4, Gap's evidence 6-1, 2, Gap's evidence 7-1 through 3, Gap's evidence 8, 9-1, 2-2, and the purport of the whole pleadings

D. Determination

1) The original acquisitor of the right to the employee invention

A) According to Article 2 subparags. 1 and 2 of the Invention Promotion Act and Article 10(1) of the Patent Act, the right to obtain a patent, etc. for an employee invention constitutes a right to obtain a patent, utility model, or design registration under the Patent Act, the Utility Model Act, Article 11 of the Utility Model Act, Article 3 of the Design Protection Act, and Articles 10 and 15 of the Invention Promotion Act, in cases where an employee, an officer, or an employee of a corporation, or a public official (hereinafter referred to as an "employee, etc.") has performed an employee invention that falls within the scope of duties of the employer, corporation, State, local government, or organization (hereinafter referred to as "employer, etc.") by performing his/her creative activities such as an invention, design, or design, etc., if the employee, etc. has acquired the right to obtain a patent, etc. for the employee invention, while the employee, etc. has transferred the right to the employee invention or the patent right related thereto, or has acquired it by the employee, etc. in an exclusive license.

Therefore, even if an employee’s employee invention was made by the Plaintiff, the right to obtain a patent, etc. for the employee’s invention should be regarded as the original acquisition of an employee’s invention, other than the Plaintiff, who is the employer, unless there are special circumstances.

B) Meanwhile, Article 20(2) of the Regulations on the Management of National Research and Development Projects provides that “the intangible outcomes, such as intellectual property rights obtained as the result of performing the national research and development projects, shall belong to the main research institute as prescribed by an agreement.” However, the above regulations are as follows: ① for the purpose of stipulating matters necessary for the planning, management, evaluation, utilization, etc. of national research and development projects under Articles 11 and 11-2 through 11-5 of the Framework Act on Science and Technology (see Article 1 of the Management Regulations) by delegation of the Framework Act on Science and Technology; in the context of the Framework Act on Science and Technology, where the Framework Act on Science and Technology, which is the mother law of the above management regulations, it is difficult to find that there are no specific grounds to allow the Plaintiff to regulate the rights to employee invention entitled to patents, etc. with respect to the invention invention; ② It is difficult to view that there are reasonable grounds to view the aforementioned regulations on the research and development projects, such as the establishment purpose of the government-invested research institute or the government-funded research institute’s research institute’s.

2) Whether the instant compensation constitutes an employee’s invention compensation

A) Relevant provisions

An employee shall have a right to receive an employee's invention compensation pursuant to Article 15 (1) of the Invention Promotion Act, where the employee has succeeded to the right to obtain a patent, patent, etc. for an employee's invention or has established an exclusive license in accordance with a contract or employment regulations

On the other hand, Article 15(2) of the Invention Promotion Act provides that "where a contract or employment regulation provides for the compensation for an employee invention, the compensation therefor shall be determined by considering the situation between the employer and the employee when determining the type of compensation and the amount of compensation, the situation in which the standards for compensation were presented to the employee, such as the publication and posting of the standards for compensation set, the situation in which the employee’s opinion is considered reasonable when determining the form of compensation and the amount of compensation from the employee when determining the amount of compensation." Paragraph (3) of the same Article provides that "if the compensation for an employee invention is not prescribed by a contract or employment regulation or if it is not deemed that the amount of compensation is a just compensation under paragraph (2), the benefits that the employer would obtain from the invention and the degree of contribution of the employee and the employee shall be considered in the completion of the invention." In addition, Article 17(1) of the Regulations on the Disposal, Management, Compensation, etc. of the employee’s invention of a public official shall be paid to the inventor equivalent to 50/100 of the proceeds from disposal."

B) In light of the aforementioned relevant provisions, it is reasonable to deem that the instant compensation is compensation paid to the Plaintiff’s employees pursuant to Article 16 and Article 17 of the Intellectual Property Management Guidelines by succession to the Plaintiff’s right to the employee’s invention pursuant to Article 3 of the Intellectual Property Management Guidelines. The nature of the compensation is the case’s employee’s invention compensation under Article 15 of the Invention Promotion Act. The instant compensation is also the same as above. However, it is reasonable to deem that the instant compensation constitutes other income subject to non-taxation under Article 12 subparag. 5 (d) (i) of the Income Tax Act, regardless of whether it was paid to the Plaintiff or paid to the Plaintiff.

In addition, the compensation of this case is calculated as "the individual creative share stated in the invention report" under Article 75 (1) 2 of the personnel management regulations or Article 4 (1) of the Guidelines for the Payment of Compensation for Technology x "the individual creative share stated in the invention." Article 17 (1) of the Regulations on the Disposal, Management, Compensation, etc. of Public Officials' Employee Inventions provides that 50/100 of the disposal compensation for the right to obtain a patent for the invention shall be paid to the inventor. (2) Article 75 (1) 2 of the personnel management regulations or Article 4 (1) of the Guidelines for the Payment of Compensation for Technology Promotion provides that 50/100 or more of the total amount of the royalties shall be deemed as the research subsidy based on technology fees. The research subsidy based on technology fees shall include not only the compensation of this case, but also the research subsidy for the person who contributed to the research and development of this case other than the inventor, and therefore, it may be recognized that the compensation of this case can be reasonably determined as the compensation guidelines for the inventor or the employee's's's's payment of non-taxation.

C) Judgment on the defendant's argument

(1) The defendant asserts that the compensation in this case is not an employee's invention compensation since it is the amount of continuous and repeated nature, not an employee's right, but an employee's invention compensation. However, when the plaintiff succeeded to the employee's right and allowed a third party to use and produce the employee's invention, the plaintiff's claim in this part shall be paid in a lump sum according to the terms and conditions of the contract, or shall be paid in a certain amount as regular or irregular divided, or in a pro rata to the sales of the product, etc., according to the terms and conditions of the contract. The defendant's claim in this part shall not be justified, on the ground that the compensation in this case, which is paid from the royalties or the royalty in this case, does not necessarily constitute an employee's invention compensation in accordance with Article 15 of the Invention Promotion Act, solely on the ground that the amount

(2) The defendant asserts that part of the royalties that the plaintiff entered into a license agreement with an enterprise, etc. and paid to a participating researcher not described as an inventor in the application or the Patent Gazette, and that it does not constitute an employee invention compensation. However, regardless of whether the plaintiff is the creator, the research bonus paid pursuant to Article 72 of the Personnel Regulations is the researcher who has a direct or indirect contribution to the research performance, but the compensation of this case paid pursuant to Articles 16 and 17 of the Intellectual Property Management Guidelines is paid only to the creator who has succeeded to the plaintiff's right to the work invention, and the research bonus subject to withholding income tax and the compensation of this case, which are not so, should be treated separately by its nature, even if the method of calculation is partially different from the plaintiff's ground for payment, the object of payment, and the purport of payment, and because the plaintiff withheld income tax on the research subsidy, it cannot be viewed as income subject to taxation. In light of the defendant's assertion that this part of this case is without merit.

(3) The Defendant asserts to the effect that other income subject to non-taxation includes an exclusive license among the license granted pursuant to Article 15(1) of the Invention Promotion Act, but does not constitute a non-exclusive license established and a compensation paid to the employer by the employee, etc., however, insofar as the employee, etc., who belongs to the Plaintiff succeeds to the Plaintiff’s right to work invention or set the exclusive license pursuant to Article 15(1) of the Invention Promotion Act, the Plaintiff, the employer, has established a non-exclusive license for the invention, and whether to receive the royalty by establishing the exclusive license is not related to the establishment of the exclusive license pursuant to Article 15(1) of the Invention Promotion Act.

D) Sub-committee

Therefore, even though the compensation of this case is an employee invention compensation under the Invention Promotion Act, which is one of the non-taxation objects, income tax, etc. should not be imposed, the disposition of this case which imposed income tax on the ground that it is an earned income subject to taxation should be revoked illegally. The plaintiff's assertion pointing this out is without merit

3. Conclusion

Therefore, the plaintiff's claim of this case is justified, and the judgment of the court of first instance is just, and the defendant's appeal is dismissed as it is without merit. It is so decided as per Disposition.