​Two bar associations fined $7.7 million each for membership ban on legal service platform

By Park Yoon-bae Posted : February 24, 2023, 15:39 Updated : February 24, 2023, 18:39

[Courtesy of LawTalk]

SEOUL -- South Korea's two bar associations were slapped with a fine of 10 billion won ($7.7 million) each for banning their members from joining LawTalk, an online platform that connects users and lawyers.
On February 23, the Korea Fair Trade Commission (KFTC) decided to impose the fine on the Korean Bar Association (KBA) and the Seoul Bar Association (SBA), stating that their ban has hindered "free and fair" competition in the legal market.
The antitrust regulator expects that the punitive action will help consumers have better access to the legal market where "information asymmetry" remains high. The measure is also likely to allow consumers broader options in choosing lawyers.
The KFTC said that it will sternly crack down on existing business associations' unfair practices of preventing innovative service platforms from entering into the market and disturbing their business activities.
Aside from the fine, the KFTC issued a correction order for the bar associations to lift the ban immediately and allow their members to join the LawTalk platform freely.
The regulator launched an investigation into the case in June 2021 when LawTalk filed a complaint with the KFTA against the bar associations for their alleged unfair practice.
The dispute between the associations and LawTalk took place in May 2021 when the KBA demanded 1,440 lawyers, who joined the platform, to withdraw from the platform. The SBA also took a similar measure against its members.
The KBA even threatened to take action against lawyers if they refuse to comply with the withdrawal demand. In October, it decided to impose 3 million won in fine on nine lawyers for providing legal services through LawTalk.
LawTalk is a legal service platform launched by Law&Compnay in 2012. Users can see a list of lawyers in different categories on the platform's website and choose among them to get legal consultations. Users also can compare different lawyers and their prices for their consulting services.
The bar associations were trying to justify their ban, arguing that the platform could hurt the quality of legal services by putting lawyers in price competition with each other.
However, the regulator pointed out that the membership ban has hampered a free and fair competition among lawyers as well as limited consumers' right to choose lawyers. It also said that the measure is not in line with the Monopoly Regulation and Fair Trade Act as well as the Attorney-at-Law Act.
In August 2021, the Ministry of Justice concluded that the LawTalk service is legitimate, saying that it does not violate the Attorney-at-Law Act. However, the KBA ignored the ministry's interpretation and took punitive action against lawyers for joining the platform service.
LawTalk now has around 2,000 lawyers as its members. The cumulative number of visitors to its website was estimated at 30 million as of July 2022, according to the operator. The cumulative number of consultation cases stood at 740,000.
Law&Company, the LawTalk operator, welcomed the KFTC's punitive action against the bar associations. It urged the associations to accept the regulator's decision and make efforts to settle the dispute immediately.
But, the KBA has refused to accept the action and vowed to launch a legal battle against the KFTC. It said that its ban on lawyers from joining the platform is not subject to the intervention of the antitrust regulator.
Some experts expect the KFTC's action to promote innovation for various online platforms. They expressed hope that the LawTalk case will set an example for solving disputes between a tax report and refund platform and the Korean Association of Certified Public Tax Accountants as well as between a cosmetic medical treatment platform and the Korean Medical Association.
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