Rotok Co-founder: "Bar Association Cutting Off New Industries... Ministry of SMEs and Startups Should Speak Up"

Jae-sung Jeong, Co-founder of Law&Company
Bar Association Disciplinary Action Against Lawyers Advertising on Legal Platforms... "Killing Lotok"
Calls for Attention from Ministry of SMEs and Related Agencies... "Legal Tech Contraction"

Jae-sung Jeong, Co-founder and Vice President of Law&Company. [Photo by Law&Company]

[Asia Economy Reporter Junhyung Lee] “The amendment proposed by the Bar Association (Korean Bar Association) is essentially an attempt to ‘kill Lotok.’ This is not just a problem with Lotok, but an issue that stifles the budding domestic legal tech industry.”

Jae-sung Jung, co-vice president and co-founder of Ro & Company, the operator of the legal platform ‘Lotok,’ stated this in an interview with Asia Economy on the 31st of last month. Vice President Jung said regarding the Bar Association’s classification of legal platforms like Lotok as ‘illegal services,’ “The term ‘illegal’ can only be used after a judicial authority has made a ruling.” He added, “Two complaints filed by the Bar Association have already been dismissed by the prosecution, and the ongoing complaint will likely reach the same conclusion.”

Confrontation with the Bar Association... “A Platform for Young Lawyers”

On the same day, Ro & Company filed a constitutional appeal against the Bar Association to prove the unconstitutionality of the ‘Regulations on Lawyer Advertising’ amended by the Bar Association earlier last month. According to the amendment, the Bar Association can discipline member lawyers who advertise on legal platforms such as Lotok. Since Lotok generates revenue solely from advertising fees, this effectively cuts off its ‘funding source.’ Vice President Jung pointed out, “There are multiple issues with the amendment. It states that participation or cooperation with the platform is prohibited, but lacks detailed definitions, allowing arbitrary interpretations, and the level of disciplinary measures is not specifically disclosed.”

On the same day, the Bar Association also revised the ‘Code of Ethics for Lawyers’ to explicitly ban the use of legal platforms through a general meeting. A Bar Association official emphasized, “The amendment to the Code of Ethics was passed with an overwhelming 73% approval rate,” adding, “Lotok claims to be a platform for young lawyers, but in reality, genuine young lawyers reject platforms that disrupt fair client acquisition order.” This is interpreted as targeting the fact that about 79% of Lotok’s approximately 4,000 lawyer members are young lawyers with less than 10 years of experience.

Outdoor advertisement of Lotoc installed inside Seoul Gyodae Station.
Photo by Lee Junhyung

However, Vice President Jung stated that the Bar Association does not understand the essence of Lotok’s advertising service. While the Bar Association points out the harms of portal advertisements, the amendment paradoxically allows portals but bans Lotok. After the internal regulation amendment caused controversy in the internet industry, the Bar Association clarified that portals such as Naver are not prohibited under the amendment.

Vice President Jung explained, “On portals like Naver, you have to pay tens of millions of won monthly to appear in the top 10 keywords, and such advertising costs are only affordable for mid-sized or larger law firms. In contrast, Lotok requires only about 1 million won in advertising fees.” According to Ro & Company, 54.3% of lawyer members spend ‘less than 990,000 won’ monthly on Lotok advertising, followed by ‘1 million to 2 million won’ (33.3%), ‘2 million to 3 million won’ (8.9%), and ‘over 3 million won’ (3.5%). Vice President Jung explained that Lotok was able to secure many young and newly established lawyer members by offering reasonable advertising fees.

“Hindering New Industries... Related Ministries Should Intervene”

Concerns were also raised that this could hinder the development of the legal tech ecosystem. Vice President Jung said, “Domestic legal tech services are already far behind advanced countries due to conservative policies such as the world’s lowest disclosure rate of lower court precedents.” He added, “Lotok resolved information asymmetry in the existing legal market, resulting in high satisfaction for both clients and lawyers. If we become a precedent that is eliminated by vested interests, it will be difficult for legal tech services to emerge domestically in the future, and we will inevitably become dependent on overseas technologies.”

Vice President Jung urged related ministries such as the Ministry of SMEs and Startups to take interest. He said, “If the government examines this issue closely, it will realize how many problems exist,” adding, “The Ministry of Justice, which has supervisory authority over the Bar Association, and the Ministry of SMEs and Startups, which oversees new industries, should raise concerns.” He stated, “Filing a constitutional appeal or a complaint to the Fair Trade Commission is the best we can do as a startup,” and “The conclusion should benefit the majority of both suppliers and consumers in the legal market.”

[Image source=Yonhap News]

Meanwhile, in the industry, concerns have been steadily raised from the early stages of the conflict that this might repeat the ‘Tada incident.’ Professor Yoosang Yoo of Soongsil University Graduate School of Small and Medium Business said, “As with the past Tada controversy, vested interests tend to block the entry of innovative services into the ecosystem,” adding, “Especially in a positive regulatory environment where only what is stipulated by current law is allowed, startups are vulnerable to backlash from vested interests.”

A CEO of a startup with five years of experience said, “Lotok is a service that has been launched for several years, so it is only natural to question why such measures are being taken now,” and added, “Since the service has been activated thanks to consumer demand for reasonable costs, outdated perceptions and regulations need to change.”

This content was produced with the assistance of AI translation services.