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Regulation of the Legal Profession in South Korea: Overview
Practical Law Country Q&A w-031-6606 (Approx. 12 pages)
Regulation of the Legal Profession in South Korea: Overview
by Kyunghoon Lee, Jiwooong Lim, Jin-uk (Joseph) Kim and Dahye Kim, Lee & Ko
A Q&A guide to the regulation of the legal profession in South Korea.
The Q&A gives a high level overview of the key practical issues including required qualifications for both domestic and foreign legal professionals working in a jurisdiction; common legal professional structures; national regulators, legal professional insurance and client protection; confidentiality and legal professional privilege; legal fees and fee regulation; client money; and notaries.
Introduction to the Regulatory Framework
The Attorney-at-Law Act is the main law governing the regulatory framework for lawyers in Korea. It provides for only one category of lawyer. The terms "lawyer" and "attorney" can be used interchangeably in Korea. A lawyer can represent clients in both civil and criminal litigation as well as perform all forms of general legal work.
Foreign legal consultants are recognised under a separate law (see Question 12).
3. What are the requirements to obtain a practising certificate/licence? How often must this be renewed?
Individuals who have obtained a professional master's degree from a law school in Korea must pass the bar exam to become a lawyer. However, a lawyer who has passed the bar exam must be in legal practice for more than six months at an organisation practising law (or complete training similar to that effect) before they can:
- Be retained by clients (either separately or jointly with another lawyer).
- Open a solo legal practice or become a partner member of a law firm.
There is no distinction between requirements for private practice and in-house counsel. There are no special requirements to renew or maintain the status as a lawyer once obtained.
Lawyers in Korea are not limited in their capacity to advise or represent their clients either geographically or in relation to practice area or court level. However, lawyers who pass the bar exam are limited in terms of appointment or opening of a legal practice business for a six-month period after passing the exam (see Question 3).
5. Are there any written codes of conduct or handbooks, or rules and/or principles that lawyers are required to abide by?
The Attorney-at-Law Act (passed by the National Assembly of Korea) sets out the rules governing lawyers. Article 1 of the Attorney-at-Law Act begins by defining a lawyer's mission and duties, followed by the basic regulatory framework of the legal profession in Korea, which includes the rules relating to the:
- Qualifications for a lawyer.
- Registration process for practising as a lawyer.
- Rights and obligations of a lawyer.
- Establishment of a law firm.
Lawyers must also comply with the Attorney's Code of Ethics (Code of Ethics) promulgated by the Korean Bar Association. The Code of Ethics is an internal set of rules established by the Korean Bar Association, breaches of which might provide grounds for disciplinary action. However, a breach of these rules does not automatically lead to criminal sanctions.
The Attorney-at-Law Act can be found online on the Korean Legal Affairs Office national legal information website (www.moj.go.kr). An unofficial English translation of the Attorney-at-Law Act can be found on the Korea Legislation Research Institute website (https://elaw.klri.re.kr).
The Code of Ethics (in Korean only) can be found on the Korean Bar Association website (www.koreanbar.or.kr).
The Attorney-at-Law Act is the main law governing the regulatory framework for Korean lawyers. Under the Attorney-at-Law Act, a lawyer in Korea must:
- Defend fundamental human rights and uphold social justice.
- Independently and freely perform their duties for the common good as a legal professional.
The Attorney-at-Law Act contains provisions imposing criminal sanctions for breaches of certain professional/fiduciary duties.
The Foreign Legal Consultant Act provides the key rules for foreign legal consultants (see Question 12).
Professional Structures
The Attorney-at-Law Act provides for the establishment of law offices or law firms in several forms, including:
- Sole practitioners.
- Law firm.
- Limited liability company law firms.
The establishment procedures differ depending on the type of law firm. In general, a law firm or a law office must:
- Prepare articles of organisation.
- Obtain approval from the Minister of Justice by submitting the articles of organisation to the local bar association and the Korean Bar Association.
- Designate a lawyer who will be in charge of business operations.
10. Are community and/or alternative legal service providers common? If so, to what restrictions are they subject, if any?
Community Legal Service Providers
In Korea, lawyers must engage in a certain amount of pro bono activities each year. Many law firms also provide pro bono services on a regular basis.
In addition, Korea operates a public-service legal officer system to provide legal aid to residents in areas where it is difficult to receive legal assistance, and to support the legal affairs carried out by government and local government entities. In certain criminal proceedings, the court may designate a lawyer who has an office in the court's jurisdiction to defend the accused in cases where the accused cannot retain their own counsel.
Alternative Legal Service Providers
Legal work cannot be undertaken by non-lawyers, and non-lawyers must not receive remuneration or other benefits for legal work. Accordingly, a lawyer cannot generally outsource legal work to a non-lawyer or non-lawyer group.
However, certain other professionals providing legal or related services are acknowledged under Korean law, including:
- "Judicial scriveners" (who can prepare a certain limited set of legal documents, such as in relation to real estate registration, company incorporation or certain court filings).
- Patent agents.
- Certified public accountants.
- Tax and customs agents.
While such alternative legal service providers are able to provide a certain limited scope of legal services, they are prohibited from conducting legal services that can only be performed by a lawyer, such as representing a client in legal proceedings before a court.
11. Are there any restrictions on self-employed lawyers providing legal services on a freelance basis?
12. Do restrictions apply to lawyers qualified outside your jurisdiction/law firms established in another country practising in your jurisdiction?
Temporary Services
A foreign lawyer who is not qualified or registered as a foreign legal consultant in Korea can represent clients in international arbitration cases. However, such foreign lawyers are prohibited from staying in Korea for more than 90 days per year.
Registration
While there are limitations and qualification requirements to be met, Korea allows lawyers qualified outside of Korea (and law firms established in another country) to practise law in Korea as registered foreign legal consultants (or foreign legal consultant offices).
Qualified and registered foreign legal consultants can:
- Advise on the laws and regulations of the country in which they are admitted as a legal professional (the "country of original licence").
- Advise on treaties to which the country of original licence is a party, and on generally approved customary international law.
- Represent clients in international arbitration cases (excluding matters relating to the laws and regulations of the Republic of Korea).
Foreign legal consultants and offices are prohibited from:
- Hiring Korean lawyers or alternative legal service providers (see Alternative Legal Service Providers).
- Jointly dealing with cases or sharing remuneration/profits with alternative legal service providers.
Foreign legal consultants must obtain approval of their qualifications from the Minister of Justice and register with the Korean Bar Association.
Legal Education, Workplace Training and Qualifying Tests
For registration and qualification as a foreign legal consultant from the Minister of Justice of Korea, the individual must:
- Be admitted as a legal professional equivalent to a Korean lawyer in a foreign country.
- Have at least three years of post-qualification legal experience in the country of original licence.
Client Protection
13. Is there a national regulator of the legal profession? In a federal jurisdiction, which body regulates the legal profession in the individual states?
The Korean Bar Association has a bar disciplinary committee. The head of the Korean Bar Association can initiate disciplinary action against a lawyer and request disciplinary action by the committee. The disciplinary action is enforced by the head of the Korean Bar Association. Certain material breaches of the Attorney-at-Law Act (including acts of bribing judges) can result in criminal prosecution and punishment.
In addition to the Korean Bar Association, local bar associations are established in each district under the jurisdiction of the local district court. In Seoul, there is one local bar association. Foreign legal consultants (see Question 12 are subject to the supervision of both the Ministry of Justice and the Korean Bar Association.
Membership of the Korean Bar Association, the national bar association of Korea, is mandatory to open a legal practice. Registration with the local bar association is also necessary. The contact information of the Korean Bar Association is:
18F, 124 Tehaeran-ro, Gangnam-gu, Seoul, 06234, Republic of Korea
T +82 2 3476 4000
16. Is there an independent disciplinary tribunal, and what disciplinary powers do the relevant regulatory bodies have? What sanctions are available?
Disciplinary action against a lawyer is determined by an attorney disciplinary committee. The process takes place in two stages, first under the Korean Bar Association then under the Ministry of Justice.
The attorney disciplinary committee of the Korean Bar Association deliberates on disciplinary cases presented before it based on a request by an applicant with authority to request the initiation of disciplinary action (such as the President of the Korean Bar Association or the Chief Prosecutor of a district prosecutor's office). If necessary, the attorney disciplinary committee can request an investigation committee (a separate committee established within the Korean Bar Association) to conduct investigations on the background facts of the disciplinary case.
The attorney disciplinary committee of the Ministry of Justice then decides on appeals made from cases determined by the Korean Bar Association's attorney disciplinary committee.
There are five types of disciplinary actions that can be issued against lawyers based on the findings of an attorney disciplinary committee:
- Permanent expulsion.
- Non-permanent expulsion. The person can seek to re-register as an attorney five years after being issued with an expulsion decision.
- Suspension from practising law for three years or less.
- A fine of up to KRW30 million.
- A reprimand.
The Minister of Justice can also issue a preliminary suspension order against a lawyer, especially in cases where either:
- The lawyer has been criminally indicted.
- There is a very high risk of the lawyer harming their client or the public interest if no action is taken.
17. Is indemnity insurance mandatory for practising lawyers? If so, what is the minimum level of cover required and are there any mandatory terms?
Under the Attorney-at-Law Act, a lawyer must not engage in matters:
- Where they (or their firm) would be representing a counterparty to a currently represented client in the same matter.
- Where they (or their firm) would be representing a counterparty to a currently represented client on a different and separate matter (unless the client approves).
- Where the lawyer has been involved as a public official, mediator or arbitrator.
A person who has previously served as a judge, prosecutor or other public official cannot be retained as a lawyer to represent clients to work on cases handled by state agencies (such as courts and prosecutor offices) for one year after retiring from such positions.
In addition, a lawyer must not receive rights, payments, benefits, demands or promises from the other party to a dispute.
Article 22 of the Code of Ethics also sets out examples of cases where a lawyer's appointment by a client is restricted, which include taking on cases where a conflict of interest exists.
An attorney owes general fiduciary duties to an existing client.
The Attorney-at-Law Act and the Code of Ethics do not stipulate explicit actions to be taken by lawyers in the event of a conflict of interest. However, a lawyer should:
- Prevent conflicts of interest from occurring if possible.
- Inform the clients and seek appropriate measures if a conflict of interest arises.
20. When can a lawyer represent more than one client in a transaction? Can a lawyer act for either of the clients between whom a conflict arises?
A lawyer (or their firm) can only represent a counterparty to a currently represented client on a different and separate matter when the client approves this. See Question 18.
In the event of a dispute between a lawyer and the lawyer's client, the client can file a complaint against the lawyer with the local bar association for mediation of the dispute.
If a client believes there are grounds for disciplinary action against their lawyer, the client can request the head of the local bar association to commence disciplinary action against the lawyer. If the head of the local bar association dismisses the client's request or does not take action within three months following the client's filing of the request, the client can file a request for the initiation of disciplinary action against the lawyer with the head of the Korean Bar Association.
22. Can lawyers/law firms hold client files, money or property in the event of a dispute about their retainer or fees?
There is no explicit provision under Korean law concerning whether a lawyer can hold or refuse to return client files, money or property in the event of a dispute between the lawyer and client over the lawyer's fees. The outcome of such a dispute will depend on the details of the engagement agreement, and sometimes the agreement will include provisions to that effect.
The engagement agreement between a lawyer and a client is typically categorised as a type of delegation contract under Korean law. As such, a lawyer must in principle deliver money and other goods received for the delegated affairs back to the client. However, the Code of Ethics allows a lawyer to offset unreceived fee payments against deposits to be returned to a client. However, unless there is a special provision stipulating otherwise in the engagement agreement, the lawyer cannot hold on to files or property simply because there is a dispute over the lawyer's fees.
While the client's money (other than lawyer's fees or retainer fees) can also be offset against the lawyer's fees in some cases, refusals to return such money can otherwise be criminally punishable for breach of fiduciary duty and/or embezzlement.
Client Engagement
23. What do client engagement communications typically include? Are there any mandatory provisions that must be included? Are there separate provisions for litigation and non-litigation (transaction or advisory) matters?
While there is no mandatory provision that must be included in an engagement agreement, the Code of Ethics sets out recommendations, including in relation to:
- Scope of work.
- Legal fees.
- Methods of payment.
- Expenses not included in legal fees.
The Code of Ethics also recommends the execution of a written engagement agreement with the client.
Engagement agreements are similar for both contentious and non-contentious matters. Lawyers typically tailor their agreements to the specific case.
The basic obligations a lawyer owes to a client under the Code of Ethics include that:
- A lawyer must be polite and sincere to the client, and endeavour to represent the client's best interest efficiently and effectively within the scope of professional ethics.
- A lawyer must not disclose or unfairly use the secrets they have learned during the course of their engagement with the client.
- Lawyers must pay attention to the protection of personal information when performing their duties.
The lawyer will therefore remain obligated to protect personal information and secrets in their possession after the professional engagement with the client comes to an end. See Question 27.
25. Can a legal professional refuse to accept a client instruction or cease to act, and in what circumstances?
Under the Attorney-at-Law Act and Code of Ethics, lawyers are obliged to promote the common good and perform their work independently. Therefore, a lawyer must not co-operate with a client in carrying out criminal or unlawful acts. If a lawyer becomes aware of a client's criminal or unlawful acts, the lawyer must immediately stop working for the client.
A typical engagement agreement usually contains a provision that allows the lawyer to terminate the engagement agreement and to resign from a case if the client's makes representations relating to the engagement agreement that are false.
Confidentiality and Legal Professional Privilege
Under the Attorney-at-Law Act and Code of Ethics, a lawyer must not:
- Disclose or unfairly use that which the lawyer learned while performing their duties.
- Disclose to the public documents, memos, and other similar materials created while performing their duties.
- These regulations represent a lawyer's professional obligations rather than the client's right to confidentiality. Currently, there are ongoing discussions in Korea on whether lawyer-client privilege should given a statutory basis.
There are exceptions to the client confidentiality rules under the Attorney-at-Law Act and Code of Ethics where:
- A special statutory provision suspending client confidentiality applies.
- Disclosure is necessary for the public good.
- The client consents to disclosure.
- Disclosure is necessary to defend the lawyer's rights.
29. Are communications with lawyers protected from disclosure (that is, privileged) in judicial or other proceedings?
In civil and criminal proceedings, a lawyer or a former lawyer can refuse to testify on confidential matters. However, such a witness will be exempt from any confidentiality obligations if:
- The client consents to the witness' testimony.
- There is a significant public interest such that witness cannot refuse to testify.
Fees
Lawyers' fees in Korea are currently not explicitly regulated. Both the use of fixed fees and contingency fees is acceptable, with success fees being typical in civil litigation. However, the Code of Ethics sets out recommendations, including in relation to legal fees.
In principle, if there is an agreement between the client and lawyer on fees, the lawyer can claim the entire agreed amount of lawyer's fees. If there are special circumstances where this would contravene the principles of good faith or equity, remuneration within the range deemed to be appropriate will be awarded.
The Supreme Court's current position is that contingent remuneration for a successful defence in criminal cases is invalid (Supreme Court Decision 2015Da200111 dated 23 July 2015).
10% VAT is charged on lawyer's fees.
32. What types of fee agreements are most commonly used for litigation and non-litigation matters? What formal requirements exist for fee agreements?
The types of fee agreements differ on a case-by-case basis. In civil litigation matters, fee arrangements are typically structured in the form of a retainer fee and success fee, while in non-litigation matters, fee arrangements usually take the form of an hourly-charge basis (in most cases with a fee cap).
The Code of Ethics sets out recommendations, including in relation to legal fee arrangements (see Question 23).
Client Money
There are no specific rules on the holding of client funds. However, if a lawyer is holding client funds, the lawyer must immediately notify the client of receipt and provide the funds to the client on demand. Recently, there have been cases where funds were stored in escrow in the form of collateral.
Notaries
35. Are notaries required for share purchases or transfers, real estate purchases or leases, or company formation?
A notary is not necessary in Korea for share purchases, transfers, real estate purchases or leases. However, there are certain instances under Korean law where notarisation is required. For example, when establishing a joint stock company under the Commercial Code, the promoter must prepare the articles of incorporation, and these articles of incorporation become effective by obtaining certification from a notary public.
The Minister of Justice can grant notary authority to a law firm established under the Attorney-at-Law Act which meets the following requirements:
- The firm must have at least two partner lawyers who have practised law for at least ten years.
- Two or more partner lawyers must be designated as accredited notaries, which must be reported to the Minister of Justice through the local Prosecutors' Office.
Therefore, a notary public (in the form of a lawyer designated to conduct notarisation works) can work within a law firm.
Contributor Profiles
Kyunghoon Lee, Co-head of Compliance Practice Group & International Litigation Team
Lee & Ko
T +82 2 772 4419
F +82 2 772 4001
E [email protected]
W www.leeko.com
Professional qualifications. Admitted to Bar, Korea, 1989; New York, 2001; District of Columbia, 2007
Language. Korean, English
Areas of practice. International litigation; litigation and arbitration; regulatory compliance; ESG; international arbitration; international IP litigation; anti-corruption; corporate governance; product liability; anti-trust and competition; anti-trust litigation; automotive industry.
Jiwooong Lim, Co-head of International Litigation Team
Lee & Ko
T +82 2 772 4830
F +82 2 772 4001
E [email protected]
W www.leeko.com
Professional qualifications. Admitted to bar, Korea, 1998; New York, 2008
Language. Korean, English
Areas of practice. Administrative litigation; asset management; capital markets; capital market disputes; commercial trusts disputes; derivatives; financial disputes; insolvency and restructuring; international arbitration; international litigation; litigation & arbitration; M&A; management rights disputes; product liability; securities.
Jin-uk (Joseph) Kim, Partner
Lee & Ko
T +82 2 6386 6353
F +82 2 772 4001
E [email protected]
W www.leeko.com
Professional qualifications. Admitted to Bar, Korea, 2012
Language. Korean, English
Areas of practice. International litigation; litigation and arbitration; regulatory compliance, ESG; international arbitration.
Dahye Kim, Associate
Lee & Ko
T +82 2 6386 0735
F +82 2 772 4001
E [email protected]
W www.leeko.com
Professional qualifications. Admitted to Bar, Korea, 2019
Language. Korean, English and German
Areas of practice. Litigation and arbitration; International litigation
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