[Column] The Narrow Escape of Lotok, Almost Becoming the 'Second Tada'

[Image source=Yonhap News]

[Asia Economy Reporter Kim Bo-kyung] The controversy surrounding Lotoc, which nearly ended as a 'second Tada' incident due to vested interest logic, has been settled for now. On the 26th, the Constitutional Court ruled the Korean Bar Association's amended 'Regulations on Lawyer Advertising' unconstitutional. The venture startup industry unanimously welcomed the decision. The government and the National Assembly should work to create an ecosystem for the growth of new industries such as legal tech.

Young entrepreneurs promoting new industries have long struggled like 'David versus Goliath,' suppressed by vested interests and legal systems. The Tada incident is a representative example. It was a case that caused disappointment and frustration in the startup industry as it intertwined with the political interests aimed at protecting the traditional taxi industry's domain.

At this juncture, the Constitutional Court's announcement sent a positive signal to the industry alongside the launch of the new government. The court emphasized the need for regulatory changes, mentioning "new media emerging with technological advancement." The legal service industry has been a sector with significant information gaps and slow technological integration. We have frequently heard numerous complaints from legal consumers around us. Change through technological innovation is most needed in this field.

The Korea Venture Business Association expressed deep welcome for the Constitutional Court's historic decision, stating it "supported innovative companies against vested interests." The Korea Startup Forum also evaluated the ruling as a decision that "responds to the era's demand to resolve information asymmetry in the opaque legal market by enabling the general public to choose lawyers with sufficient information, thereby respecting citizens' rights and interests."

During the one year since Law&Company, the operator of Lotoc, filed a constitutional complaint, the company stood at a crossroads of survival. The damage suffered from disputes with the Bar Association was immense. The number of Lotoc lawyer members had increased consecutively for 85 months after the service launch, reaching nearly 4,000 in March last year, but by November last year, it had decreased by about half to around 1,700.

Now, promising domestic startups must expand not only into the domestic market but also into the global market. Legal tech, which introduces IT technology into legal services, has about 7,000 global companies competing fiercely in overseas markets. While global legal tech companies compete against the clock, Lotoc wasted precious time in disputes with vested interests.

First, the government should prepare to resolve disputes surrounding legal advertising platforms through the 'One Step Model,' a business conflict mediation project. Following this Constitutional Court decision, the National Assembly should also establish and improve laws and systems that can give hope to startups and young entrepreneurs.

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