Korea’s next frontier in AI governance is moving from laboratories to courtrooms. After becoming the first nation to fully enforce an AI Basic Act, lawmakers and tech leaders are now confronting its most human test yet: can innovation coexist with the law it seeks to transform its LegalTech? The answer may shape not only Korea’s digital justice system but also how democracies adapt AI to their rule of law.

LegalTech Policy Forum at National Assembly Marks Turning Point

On February 9, Rep. Kwon Chil-seung of the Democratic Party and the Korea Artificial Intelligence Association convened a national policy forum at the National Assembly to discuss the country’s stalled LegalTech Promotion Act.

The event gathered legislators, lawyers, and LegalTech founders from Daeryun Law Firm, LBox, and Nexus AI to explore practical cooperation models between law and technology under Korea’s new AI governance era.

The forum, titled “LegalTech Policy Debate for Protecting Citizens’ Rights and Choice in the AI Era,” addressed structural challenges exposed by the AI Basic Act’s enforcement.

Despite Korea’s world-first AI law, participants noted that the current legal framework fails to reconcile professional boundaries with digital innovation — leaving verified LegalTech services constrained while citizens increasingly rely on unregulated AI tools.

Why LegalTech Became Korea’s Next Governance Test

Korea’s LegalTech Promotion Act, first proposed by Rep. Kwon in 2024, seeks to define, legalize, and promote AI-enabled legal services within national regulation. But while the AI Basic Act established a general framework for trustworthy AI, it left LegalTech in a legal vacuum.

Under the Attorney Act, only licensed lawyers may provide legal advice — meaning even verified AI-powered legal tools are effectively barred from public use.

That gap has created a paradox. According to multiple speakers, while domestic LegalTech startups remain restricted, citizens already turn to foreign general-purpose AIs like ChatGPT for free legal answers, exposing themselves to misinformation and data risks.
Choi Yi-seon, policy adviser and attorney at the Korea AI Association, called it a “regulatory illusion”:

“Believing that banning LegalTech will stop people from using AI in legal services is the most dangerous misconception. The public is already relying on high-risk general AI systems.”

The data points are alarming. Korea’s legal service trade deficit exceeded KRW 1.6 trillion (~ USD 1.2 billion) in 2024, with growing payments to foreign law firms and overseas AI-based platforms. Experts warned that unless Korea accelerates institutional reform, domestic legal data and user interactions could flow abroad, enriching foreign large language models and weakening national legal sovereignty.

Industry Voices Call for Immediate Legal Clarity

LegalTech startup leaders used the session to press for urgent action.
Lee Jin, CEO of LBox, argued that generative AI can democratize access to justice by narrowing the information gap between citizens and legal professionals:

“AI can help eliminate the asymmetry in legal information and expand access to justice. Korea must secure its own Legal AI infrastructure instead of depending on foreign models.”

Lee Jae-won, CEO of Nexus AI, added that even limited relaxation under lawyer supervision could revive the domestic ecosystem:

“We need at least a temporary safeguard. If lawyers remain accountable, AI-powered tools should not be blocked entirely. Otherwise, technology companies with real capability still cannot reach clients.”

The Korean Bar Association maintains that AI-driven legal advice to non-lawyers violates existing law. Yet even government officials now acknowledge that prohibition may no longer be sustainable.

Hong Hyung-seok, Legal Officer at the Ministry of Justice, confirmed that new AI service guidelines are under review, noting that the ministry is “collecting expert opinions to issue clear standards as soon as possible.”

A Mirror of Korea’s AI Transition

The LegalTech debate mirrors a broader shift across Korea’s innovation landscape — from regulatory design to ecosystem calibration. Just weeks after the AI Basic Act’s enforcement, policymakers are recognizing that compliance without adaptive flexibility risks immobilizing high-value industries.

While the AI Basic Act built Korea’s first AI governance structure, the LegalTech debate reveals where that structure meets friction: professional exclusivity, institutional inertia, and unclear accountability.

The same dynamic that once tested AI startups — the struggle to interpret broad regulation into operational rules — now applies to lawyers and technologists sharing the same field.

For Korea’s venture ecosystem, LegalTech may soon become a litmus test for how AI policy translates into investable innovation. If the new act passes, it could unlock a legally protected market for specialized AI startups in document automation, risk analysis, and client representation — all high-demand areas globally.

If it stalls, foreign LegalTech platforms will continue to dominate, drawing user trust, data, and capital beyond Korea’s jurisdiction.

AI in Korea’s LegalTech: From Regulation to Collaboration

Rep. Kwon positioned the LegalTech Promotion Act as both a continuation and correction of Korea’s regulatory momentum.

“When the AI wave transforms professional fields, conflict must give way to coexistence. LegalTech is not about replacing lawyers, but redefining how human expertise and AI can coexist within the law.”

The discussion underscored a national inflection point. After mastering industrial technology policy for hardware and chips, Korea is now learning to regulate systems that think. The success of this LegalTech debate may decide whether Korea’s next era of AI governance strengthens innovation — or slowly legislates it out of reach.

Key Takeaway: Korea’s LegalTech Turning Point

• Event: LegalTech Policy Forum, National Assembly, Feb 9, 2026.
• Lead Figures: Rep. Kwon Chil-seung and the Korea Artificial Intelligence Association.
• Core Issue: LegalTech Promotion Act aims to legalize and standardize AI-powered legal services.
• Structural Conflict: Attorney Act prohibits non-lawyer legal practice, restricting domestic LegalTech despite rising global adoption.
• Economic Signal: Korea’s legal services trade deficit hit KRW 1.6 trillion in 2024, with growing reliance on foreign AI systems.
• Government Position: Ministry of Justice drafting guidelines for AI-based legal services.
• Ecosystem Significance: LegalTech may define how Korea’s AI governance evolves from compliance to co-creation.

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