SEC. 117 (Exemption from Securities Transaction Tax)

In the following cases, the securities transaction tax shall be exempted. 1. When transferring shares or equity acquired by directly investing in startups or venture companies by venture capital companies, startup accelerators, venture capital investment partnerships, or venture investment purpose companies. 2. When transferring shares or equity acquired by directly investing in new technology business entities by new technology business financiers or new technology business investment partnerships. 2.2. When transferring shares or equity acquired by directly investing in startups or venture companies by agro-fishery investment partnerships. 2.3. Deleted <2020.2.11> 2.4. When transferring shares or equity acquired by directly investing in KOSDAQ-listed companies (limited to small and medium-sized enterprises within two years after listing) by venture capital companies, new technology business financiers, startup accelerators, investment partnerships referred to in subparagraphs 1, 2, and 2.2, or venture investment purpose companies. 2.5. When transferring shares in the following categories, as prescribed by a Presidential Decree, by financial investment business entities as referred to in Article 8 (1) of the Capital Markets and Financial Investment Business Act, as designated by a Presidential Decree, for the purpose of fostering transactions in the derivatives market as referred to in Article 8 (2) 4 (2) of the same Act, taking into account transaction volume, market capitalization, turnover rate, etc. However, this shall be limited to cases prescribed by a Presidential Decree, such as transfers to hedge risks from derivative price fluctuations. a. In the case of derivatives whose underlying assets are stock price indexes: Shares constituting the stock price index, which is the underlying asset of the relevant derivative. b. In the case of derivatives other than those in item a: Shares that are the underlying assets of the relevant derivative. 3. When transferring shares, as prescribed by a Presidential Decree, by financial investment business entities as referred to in Article 8 (1) of the Capital Markets and Financial Investment Business Act, as designated by a Presidential Decree, for the purpose of fostering securities trading transactions in the securities market as referred to in Article 8 (2) 4 (1) of the same Act and multilateral trading facilities as referred to in Article 8 (5) of the same Act, taking into account transaction volume, market capitalization, turnover rate, etc. 4. When transferring shares or equity acquired by directly investing in startups, venture companies, or KOSDAQ-listed companies (limited to small and medium-sized enterprises within two years after listing), or through investment purpose companies as referred to in Article 249 (23) (3) of the Capital Markets and Financial Investment Business Act, by private equity funds specializing in startups and ventures. 5. When the Postal Savings Fund Management Agency as referred to in Article 2 (2) of the Special Act on the Management of Postal Business and corporations managing and operating funds established under the laws prescribed in Annex Table 2 of the State Finance Act (hereinafter referred to as "fund management entities" in this subparagraph) transfer shares of the underlying assets (in the case of fund management entities, limited to shares listed on the KOSDAQ market under the Capital Markets and Financial Investment Business Act), in connection with transactions of derivatives as prescribed by a Presidential Decree, which are exchange-traded derivatives as referred to in Article 5 (2) 1 of the Capital Markets and Financial Investment Business Act (hereinafter referred to as "derivatives" in this subparagraph), for the purpose of gaining profit from the price difference between the derivatives and the shares of the underlying assets (referring to shares constituting the relevant index when the underlying asset of the relevant derivative is a stock price index; hereinafter the same applies in this subparagraph), as prescribed by a Presidential Decree. 6. Deleted <2018.12.24> 7. When shares or equity held by non-performing financial institutions or non-performing cooperatives or cooperatives at risk as referred to in Article 2 (3) and (4) of the Act on the Improvement of the Structure of Agricultural Cooperatives (hereinafter referred to as "non-performing agricultural cooperatives") are transferred pursuant to early corrective measures (including early corrective measures under Article 4 of the Act on the Improvement of the Structure of Agricultural Cooperatives; hereinafter the same applies in this subparagraph) or decisions on contract transfer, and when financial institutions or cooperatives and central associations as referred to in Article 2 (1) and (2) of the Act on the Improvement of the Structure of Agricultural Cooperatives that receive such transfer re-transfer them. 7.2. When shares or equity held by non-performing cooperatives or cooperatives at risk as referred to in Article 2 (3) and (4) of the Act on the Prevention of Non-performance and Structural Improvement of Fisheries Cooperatives (hereinafter referred to as "non-performing fishery cooperatives") are transferred pursuant to early corrective measures (including early corrective measures under Article 4.2 of the same Act; hereinafter the same applies in this subparagraph) or decisions on contract transfer, and when cooperatives or central associations as referred to in Article 2 (1) and (2) of the same Act that receive such transfer re-transfer them. 7.3. When shares or equity held by non-performing cooperatives or cooperatives at risk as referred to in Article 2 (3) and (4) of the Act on the Improvement of the Structure of Forestry Cooperatives (hereinafter referred to as "non-performing forestry cooperatives") are transferred pursuant to early corrective measures (including early corrective measures under Article 4 of the same Act; hereinafter the same applies in this subparagraph) or decisions on contract transfer, and when cooperatives or central associations as referred to in Article 2 (1) and (2) of the same Act re-transfer shares or equity received from non-performing forestry cooperatives pursuant to early corrective measures or decisions on contract transfer. 8. When shares or equity acquired through the conversion of claims or directly acquired by the Korea Deposit Insurance Corporation or resolution financial institutions as referred to in Article 36 (3) of the Depositor Protection Act (hereinafter referred to as "resolution financial institutions") for the purpose of carrying out the business of resolving non-performing financial institutions under Article 18 (1) 6 or Article 36 (5) (1) of the Depositor Protection Act, are transferred from financial companies falling under any of the following categories: a. Non-performing financial institutions as referred to in Article 2 (5) of the Depositor Protection Act. b. Financial companies at risk as referred to in Article 2 (6) of the Depositor Protection Act. c. Financial companies receiving financial support under Article 38 of the Depositor Protection Act. 9. When shares or equity acquired through the conversion of claims or directly acquired by the Korea Asset Management Corporation established under the Act on the Establishment of the Korea Asset Management Corporation, etc. (hereinafter referred to as "Korea Asset Management Corporation") for the purpose of carrying out the business of resolving non-performing financial institutions, are transferred. 10. Deleted <2010.1.1> 11. Deleted <2006.12.30> 12. Deleted <2006.12.30> 13. Deleted <2018.12.24> 14. When shares are transferred for the establishment of a newly established company under Article 47 (2) of the Corporate Tax Act, mergers under Article 44 (2) or (3) of the same Act, divisions that meet the requirements of Article 46 (2) or Article 47 (1) of the same Act, or for the comprehensive exchange or transfer of shares that meet all the requirements of Article 38 (1) of this Act. 15. Deleted <2010.1.1> 16. When shareholders of financial institutions, etc., shareholders of financial institutions and companies closely related to financial business as referred to in Article 2 (1) 1 of the Financial Holding Companies Act, or financial holding companies under the same Act (hereinafter referred to as "financial holding companies") transfer or exchange shares under Article 38 (2). 17. Deleted <2006.12.30> 18. Deleted <2010.1.1> 19. When shares or equity acquired through the conversion of claims or directly acquired from non-performing agricultural cooperatives by the Mutual Savings Protection Fund established under the Act on the Improvement of the Structure of Agricultural Cooperatives and the Agricultural Cooperative Asset Management Company for the purpose of carrying out the business of resolving non-performing agricultural cooperatives, are transferred. 19.2. When shares or equity acquired through the conversion of claims or directly acquired from non-performing fishery cooperatives by the Mutual Savings Protection Fund established under the Act on the Prevention of Non-performance and Structural Improvement of Fisheries Cooperatives for the purpose of carrying out the business of resolving non-performing fishery cooperatives, are transferred. 19.3. When shares or equity acquired through the conversion of claims or directly acquired from non-performing forestry cooperatives by the Mutual Savings Protection Fund established under the Act on the Improvement of the Structure of Forestry Cooperatives for the purpose of carrying out the business of resolving non-performing forestry cooperatives, are transferred. 20. Deleted <2014.12.23> 21. When shares are transferred through securities trading transactions in the securities market as referred to in Article 8 (2) 4 (1) of the Capital Markets and Financial Investment Business Act or multilateral trading facilities as referred to in Article 8 (5) of the same Act, by an index-tracking investment trust as referred to in Article 234 (1) of the Capital Markets and Financial Investment Business Act, to reflect changes in the constituent stocks of the tracked index. 22. When shares or equity received as a contribution in kind from the Korea Development Bank established under the Korea Development Bank Act by the NH Financial Holding Company established under the Agricultural Cooperatives Act, pursuant to Article 3 of the Addenda to the Agricultural Cooperatives Act, Amendment Law No. 10522, are transferred to subsidiaries of the NH Financial Holding Company, such as NH Bank. 23. When shares or equity acquired by directly investing or contributing to companies designated by Presidential Decree among companies undergoing financial restructuring as referred to in Article 249 (22) (1) of the Capital Markets and Financial Investment Business Act, or through investment purpose companies as referred to in Article 249 (22) (3) of the same Act, by corporate financial stability private equity funds as referred to in Article 249 (22) (1) of the Capital Markets and Financial Investment Business Act, are transferred. 24. When shares or equity are transferred under Article 121 (30) (1).

Deleted <2011.12.31>