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What isn't illegal but should be?
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Keep in mind that the person you reply to isn't wrong: Big corpos would still be lobbying, as they got the resources to hide it effectively and keep everyone trying to sue them over suspicions of lobbying stuck in litigation hell.
Anybody less affluent would however find it impossible to do any lobby work. Environmental agencies etc.
This is one of those situations where just outlawing something does the least affect the very party you would want to hit most.
That's a better approach I think, yes. It'll be difficult to prevent collusion but effectivey capping the size of most companies and maybe their across-border reach would be a good way to keep a tighter leash on them.