Australia's consumer watchdog, the Australian Competition and Consumer Commission (ACCC), has sued Amazon, accusing the e-commerce giant of using allegedly unfair contract terms to introduce advertising into its Prime Video streaming service without giving subscribers a refund option. According to the ACCC, the unlawful terms were included in contracts with over one million annual subscribers between 1 November 2023 and 18 August 2025.
ACCC Allegations and Consumer Impact
The ACCC alleged that Amazon violated Australian consumer protection law by making unfair contracts with subscribers. Gina Cass-Gottlieb, ACCC Chair, stated: "Consumers who wanted to avoid ads were left with no choice but to pay more to maintain the service they'd initially signed up for."
When Amazon began rolling out ads in Prime Video globally in early 2024, Australian subscribers were told they would need to pay an additional monthly fee to keep the service ad-free, raising the monthly price to 12.99 Australian dollars. At that point, the ACCC noted that over 850,000 people in Australia had already paid for a full year of Prime service. "Those subscribers were provided with a degraded, ad-supported Prime Video service for the balance of their prepaid term unless they paid for the ad-free option," the ACCC said in a court filing.
Unfair Contract Terms
The ACCC identified five specific terms in Amazon's contracts that it considers unfair. These terms allegedly permitted Amazon Australia to unilaterally make "materially adverse changes" to its services — including but not limited to Prime Video — and to the terms governing those services, without giving subscribers any contractual right to refunds or other meaningful redress. The contracts affected covered the period between 1 November 2023 and 18 August 2025.
| Timeline | Event |
|---|---|
| Pre-2024 | Prime Video was ad-free in Australia; Prime launched in Australia in 2018 |
| Early 2024 | Amazon begins global ad rollout for Prime Video |
| After ad introduction | Subscribers must pay extra AUD 12.99/month to avoid ads; prepaid annual subscribers affected |
| 1 Nov 2023 – 18 Aug 2025 | ACCC says five unfair terms were in contracts with over 1 million customers |
| 30 June 2026 | ACCC files lawsuit (publication date of article) |
Broader Regulatory Scrutiny of Amazon
This is not the first time Amazon's treatment of subscribers has drawn government attention. In the United States, the Federal Trade Commission (FTC) has taken legal action against Amazon, alleging the company signed people up for Prime without their consent and then made canceling difficult. On 30 June 2026 (the date of this report), Amazon also agreed to pay an FTC fine to resolve claims that it created a "Kafkaesque ordeal" for victims of online shopping fraud.
In the United Kingdom, the government has previously investigated Amazon's product listing methods and the proliferation of fake reviews. Amazon has been approached by the BBC for comment on the Australian lawsuit but has not yet responded.
Implications for Trade and Consumer Policy
While this case focuses on domestic consumer protection, it signals heightened regulatory vigilance that could affect Amazon's operations globally, including for trade-related services such as logistics and cross-border e-commerce. Importers and exporters using Amazon’s platform should be aware that regulatory actions may influence terms of service and dispute resolution mechanisms. The ACCC's action reinforces the importance of fair contracting standards, particularly for digital services that have international reach.
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