Open Decision Ledger · Capital markets & finance
Determining Transactions Excluded from Disgorgement of Short-Swing Profits and Whether a Management Premium and Capital Gains Tax May Be Deducted
Translated from the Korean original. Read the Korean
Supreme Court, Mar. 24, 2016, 2013Da210374 (judgment)
No holding summary · checked against points at issue. The official text publishes no summary of the holding for this decision. The quotation and factors in this record are copied verbatim from the points at issue; the evidence for each axis is taken from the points at issue, the order and the reasons.
Case name: 단기매매차익반환청구
Official text on the National Law Information Center
Question
Where an insider transfers controlling shares together with a management premium, is the insider's short-swing trading excluded from disgorgement liability, and may the management premium or capital gains tax be deducted in computing the profit to be disgorged?
Holding
Even where the transaction does not fall within a ground for exemption under the Enforcement Decree, the application may be excluded if the transaction is of a type that has no possibility whatsoever of the unfair use of inside information in objective terms. The Supreme Court, however, held that a disgorgement liability is borne where the transaction is not involuntary or where the possibility of access to inside information cannot be completely excluded, and that the management premium and capital gains tax are not deducted in computing the profit, thereby affirming the court below.
Points at issue, verbatim
객관적으로 내부정보를 부당하게 이용할 가능성이 전혀 없는 유형의 거래에 대하여 자본시장과 금융투자에 관한 법률 제172조 제1항의 적용을 배제할 수 있는지 여부(적극)
Unofficial English translation
Whether the application of Article 172 (1) of the Capital Markets and Financial Investment Business Act may be excluded in the case of a type of transaction in which there is objectively no possibility whatsoever of unfairly using inside information (affirmative)
Disposition
Dismissed Stated in the decision
상고를 기각한다.
Unofficial English translation
The appeal is dismissed.
Form of the test
Existing test applied Read from the decision
원심판결 이유를 앞서 본 법리와 기록에 비추어 살펴보면
Unofficial English translation
Upon examining the reasons for the judgment of the court below in light of the legal principle and records stated above,
Factors
- 객관적으로 내부정보를 부당하게 이용할 가능성이 전혀 없는 유형의 거래
- 내부정보에 대한 부당한 이용의 가능성을 판단하는 방법
- 이른바 경영권 프리미엄을
- 양도소득세를 공제하여야 하는지 여부(소극)
- 헌법 제23조가 보장하는 재산권을 침해하는 것인지 여부(소극)
Unofficial English translation
• a type of transaction in which there is objectively no possibility whatsoever of unfairly using inside information
• the method of determining the possibility of unfair use of inside information
• the so-called management control premium
• whether income tax on capital gains must be deducted (negative)
• whether it infringes upon the property rights guaranteed by Article 23 of the Constitution (negative)
Relation to precedent
Follows earlier decisions Stated in the decision
대법원 2008. 3. 13. 선고 2006다73218 판결
Unofficial English translation
Supreme Court Decision 2006Da73218 decided March 13, 2008
Decisions referred to
[1] 대법원 2008. 3. 13. 선고 2006다73218 판결(공2008상, 517) / [2] 대법원 2004. 2. 12. 선고 2002다69327 판결
Burden of proof
Not addressed Not in the decision
Open question and revisit condition
What specific types of transactions are those in which the insider had no discretion and the possibility of access to inside information was completely excluded, so that disgorgement liability is waived?
If Article 172, paragraph (1) of the Financial Investment Services and Capital Markets Act, Article 195, paragraph (1) of the Enforcement Decree of the same Act, or Article 198 of that Enforcement Decree is amended, this reading will be re-examined.
Cross-family AI independent reading & axis check
7 of 8 axes matched GPT-6 Astra (OpenAI, codex CLI) · 2026-10-16
When compared with an independent reading by another AI (GPT-6 Astra), which read only the original text without seeing the primary reading, 7 of the 8 axes agreed, and the readings diverged on the fourth axis (Form of the test).
Axis 4 (Form of the test): Primary “Existing test applied” vs Independent “Elements stated”
The Holdings set out both the conditions for exclusion from disgorgement liability and the determination that no deduction is allowed; the primary reading appears to have placed weight on the conclusion in the specific case, and the independent reading on the requirements for recognizing the exception.
객관적으로 내부정보를 부당하게 이용할 가능성이 전혀 없는 유형의 거래Raw responses and comparison record: Protocol · Blind readings (JSONL) · Axis comparison (JSONL) · SHA-256 (JSON)
Lower-court contrast & scope of application
Lower-court reading vs. Supreme Court holding
Lower-court context: The court below (Seoul High Court Decision 2012Na95044 pronounced July 18, 2013) rejected all of the defendant's assertions: that there was no possibility whatsoever that the sale transferring the controlling shares and the subsequent purchase had made unfair use of inside information; that the management premium should be excluded in computing the profit; and that capital gains tax should be included in the transaction costs eligible for deduction.
Supreme Court standard: The Supreme Court held that the obligation to disgorge cannot be avoided where the transaction is not involuntary or where the possibility of access to inside information cannot be completely excluded; that the management premium is the consideration for the shares themselves; and that capital gains tax is not an inevitable transaction cost, and that Article 195, paragraph (1) of the Enforcement Decree, which does not allow its deduction, does not exceed the scope of delegation nor infringe property rights. The Court therefore found the reasoning of the court below to be proper and dismissed the final appeal.
Distinguishing conditions
- Where the acquisition or disposition of shares was an involuntary transaction carried out irrespective of the insider's will, and the possibility of access to inside information is objectively excluded
- Where the cost whose deductibility is at issue is a transaction tax or transaction cost that is inevitably incurred in every share transaction, unlike capital gains tax
- Where the transaction directly falls within a ground for exemption prescribed in Article 198 of the Enforcement Decree
Record verification notes
Before asserting the same conclusion, it should first be checked whether the trade was a discretionary transaction of the insider, and whether circumstances showing that the possibility of his access to inside information can be completely excluded appear in the record.
From the official text
Points at issue
[1] 자본시장과 금융투자에 관한 법률 시행령 제198조에서 정한 예외사유에 해당하지 않으나 객관적으로 내부정보를 부당하게 이용할 가능성이 전혀 없는 유형의 거래에 대하여 자본시장과 금융투자에 관한 법률 제172조 제1항의 적용을 배제할 수 있는지 여부(적극) 및 이때 내부정보에 대한 부당한 이용의 가능성을 판단하는 방법 [2] 이른바 경영권 프리미엄을 자본시장과 금융투자에 관한 법률 제172조 제1항에서 정한 단기매매차익을 산정할 때 제외하여야 하는지 여부(소극) [3] 주권상장법인의 내부자가 반환할 단기매매차익을 산정할 때 양도소득세를 공제하여야 하는지 여부(소극) / 이 경우 양도소득세의 공제를 규정하지 않은 자본시장과 금융투자에 관한 법률 시행령 제195조 제1항이 자본시장과 금융투자에 관한 법률 제172조 제1항의 위임 범위를 넘어선 것인지 여부(소극) 및 헌법 제23조가 보장하는 재산권을 침해하는 것인지 여부(소극)
Unofficial English translation
[1] Whether the application of Article 172 (1) of the Capital Markets and Financial Investment Business Act may be excluded in the case of a type of transaction in which there is objectively no possibility whatsoever of unfairly using inside information, although it does not fall under any of the exceptions prescribed in Article 198 of the Enforcement Decree of the Capital Markets and Financial Investment Business Act (affirmative), and the method of determining the possibility of unfair use of inside information at that time [2] Whether the so-called management control premium must be excluded when calculating the short-swing trading profits prescribed in Article 172 (1) of the Capital Markets and Financial Investment Business Act (negative) [3] Whether income tax on capital gains must be deducted when calculating the short-swing trading profits to be returned by an insider of a listed company (negative) / Whether Article 195 (1) of the Enforcement Decree of the Capital Markets and Financial Investment Business Act, which does not provide for the deduction of income tax on capital gains, exceeds the scope of the delegation under Article 172 (1) of the Capital Markets and Financial Investment Business Act (negative), and whether it infringes upon the property rights guaranteed by Article 23 of the Constitution (negative)
Summary of the holding
The official text publishes no summary of the holding for this decision. The quotation and factors in this record are copied verbatim from the points at issue; the evidence for each axis is taken from the points at issue, the order and the reasons.
Order
상고를 기각한다. 상고비용은 피고가 부담한다.
Unofficial English translation
The appeal is dismissed. The costs of the final appeal shall be borne by the defendant.
Provisions referred to
[1] 헌법 제23조, 자본시장과 금융투자에 관한 법률 제172조 제1항, 제6항, 자본시장과 금융투자에 관한 법률 시행령 제198조 [2] 자본시장과 금융투자에 관한 법률 제172조 제1항 [3] 헌법 제23조, 자본시장과 금융투자에 관한 법률 제172조 제1항, 자본시장과 금융투자에 관한 법률 시행령 제195조 제1항
Read 2026-10-16 · Cross-read 2026-10-16. All quotes matched against the official text. The Chinese-character placeholders the court used for anonymised parties are given in their Korean readings, and parenthetical Chinese-character glosses are omitted.
Every entry is published only after all quotes have been matched character by character against the official text, and audited by an independent second reading from a different model family across all eight axes. Both agreed axes and text-grounded interpretive divergences are recorded openly. The ledger is a research record, not an assessment of the court or advice on any matter.
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