[Exclusive] Fair Trade Commission's 'Bar Association Sanctions' Delayed... Decision Scheduled for Next Year

Fair Trade Commission to Conclude 'Bar Association Sanctions' Next Year... Originally Planned for October Decision
Bar Association Requests Another Review Delay... Ultimately Unable to Decide Within the Year
Disciplinary Action Against Lawyers Joined 'LawTalk'... Suspected Violations of Fair Trade Act and Others

Legal Service Platform 'Lotoc' Police Non-Prosecution Decision
(Seoul=Yonhap News) Reporter Ryu Hyorim = Ro & Company, the operator of Lotoc, a legal service platform, stated at a press conference on January 4th that the non-prosecution decision by the police once again proved the legality of the Lotoc service, and that they would hold legal responsibility for false claims related to Lotoc. The photo shows the 'Lotoc' advertisement installed on a street in Seocho-gu, Seoul, that afternoon. 2022.1.4
ryousanta@yna.co.kr
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? Yonhap News Agency, Unauthorized reproduction and redistribution prohibited

[Asia Economy Sejong=Reporter Lee Jun-hyung] The Korea Bar Association's disciplinary sanctions, which the Fair Trade Commission (FTC) planned to conclude last October, will be decided next year. The Bar Association is accused of violating the Monopoly Regulation and Fair Trade Act (Fair Trade Act) and other laws by disciplining lawyers registered on the legal service platform "Lotoc."

According to comprehensive reporting on the 9th, the FTC decided to review the Bar Association's violations of the Fair Trade Act and the Act on Fair Labeling and Advertising (Labeling and Advertising Act) at next year's plenary session. Originally, the FTC planned to deliberate and decide on the sanctions against the Bar Association at the plenary session in October this year. However, the Bar Association requested a postponement of the review to the FTC, causing the agenda to be pushed back. The FTC then attempted to review the case last month, one month later than planned, but the Bar Association reportedly requested another postponement through an official letter.

Ultimately, the FTC decided to review whether to sanction the Bar Association at next year's plenary session. An FTC official explained, "The Bar Association requested more time to prepare for the review," adding, "There were also internal opinions that improvements were needed, which delayed the schedule."

Seven Years of Legal Conflict

This case began when Law & Company, the operator of Lotoc, reported the Bar Association to the FTC in June last year. The reason was that the Bar Association's revised "Regulations on Lawyer Advertising" and "Code of Ethics for Lawyers" in May last year violated current laws. According to the amendments, the Bar Association can discipline affiliated lawyers registered on legal service platforms. Law & Company claims that the Bar Association unfairly restricted the advertising and business activities of its affiliated lawyers, violating the Fair Trade Act and the Labeling and Advertising Act.

The conflict between Lotoc and the legal community has continued since 2015, but most institutions have sided with Lotoc. The Seoul Bar Association filed a complaint against Law & Company in 2015 for violating the Attorney-at-Law Act, but the Seoul Central District Prosecutors' Office dismissed the case due to "no charges." The Lawyers for the Protection of Professional Fields also filed a complaint against Law & Company in 2020, but the Seoul Metropolitan Police Agency decided not to prosecute in December last year. The Constitutional Court ruled in May this year that the Bar Association's regulation banning affiliated lawyers from joining Lotoc was "partially unconstitutional."

"We Must Block Privileged Rule Violations"

The FTC is also leaning toward sanctioning the Bar Association. In November last year, the FTC sent a review report (equivalent to a prosecutor's indictment) to the Bar Association containing opinions on sanctions for violations of the Fair Trade Act and the Labeling and Advertising Act. The FTC viewed the Bar Association's policy of disciplining lawyers registered on Lotoc as a prohibited act by a business association under the Fair Trade Act and as restricting free labeling and advertising activities.

However, the delay in the FTC's decision has increased business risks for Lotoc. While the FTC has not decided whether to sanction the Bar Association, the Bar Association has taken disciplinary actions against lawyers registered on Lotoc. The Bar Association held disciplinary committees consecutively in October and last month for lawyers registered on Lotoc, imposing sanctions with fines up to 3 million won. This is the first time the Bar Association has disciplined affiliated lawyers for joining Lotoc.

There are voices questioning whether the FTC's policy to promote innovative competition has been undermined. Although FTC Chairman Han Ki-jung emphasized innovative competition in his inaugural speech and other remarks, the decision on sanctions against the Bar Association has been repeatedly postponed. A startup industry official said, "Isn't the FTC's role to block privileged rule violations and create a fair market environment for innovative services?"