Naver head office located at Jungja-dong, Bundang-gu, Sungnam city

Doubts have arisen over how the 'dinosaur portal' Naver, which was known as NHN back 2005, evaded the law and built a headquarters situated in the main part of the city of Sungnam, pocketing the 15 billion won difference.

It was reported that after receiving approval for its business claiming that it would install 'direct facility of venture enterprise' in the city-owned land of Sungnam city, Naver used it as its headquarters office.

According to Gyeonggi Province, Sungnam City, and related industries on August 11, Naver made a private contract of purchasing 6600 ㎡ of Sungnam City-owned land in 2005 at 34.6 billion won under the promise of building a venture facility.

The purchase price of city-owned land that Naver signed a contract with Sungnam city at the time was found out to cost 17,330,000 won per 3.3 ㎡, being only two thirds of market value, which was about 25,000,000 won per 3.3 ㎡.

The venture facility should comprise more than 4 venture companies and small and medium enterprises engaged in knowledge-based, knowledge, and information & technology industry using more than 70% of the total area. It is virtually impossible to purchase the site if a venture company doesn't build a building.

Naver was in a difficult situation to construct the venture facility since it already had annual sales in excess of 166.3 billion won with 709 employees back in 2003, graduating from small business.

However, Naver exploited a loophole in the "Special Enforcement Act on Promoting Venture Businesses", and purchased the city land from Sungnam city under the condition of constructing 'venture company direct facility', making a huge profit of 15 billion won.

According to Restriction of Special Taxation Act, small and medium sized enterprises with 300 employees and annual sales exceeding 30 billion won can be accepted as small and medium sized enterprises for 4 years. Naver maintained its position as a venture company by acquiring an approval from the Small Business Administration confirming the company as a venture company until January 2006. Then, Naver postponed the construction time for the venture facility and didn't inform the fact that the company was a large company until 2006.

Also, Naver was exempted from acquisition fee and registration fee. Naver paid its exempted acquisition registration fee after completing the construction of its head office in 2010.

Gyunggi Province and Sungnam City said, "It would be difficult to avoid being blamed for purchasing the city land dirt cheap abusing the existing law."

Despite AsiaToday's continuous demands for Naver's explanation, an official from Naver evaded answering, "We cannot make an official announcement at the moment."