The ACCC has sued Amazon for breaching Australian Consumer Law by using “unfair” contract terms in subscriptions to Prime Video to force subscribers to pay more for ad-free services.
The ACCC said that between November 2023 and August 2025, more than one million subscribers’ contained what it described as “five unfair contract terms” that allowed it to unilaterally make negative changes during the contract period without offering subscribers a remedy.
The competition watchdog also alleged that Amazon later relied on one or more of these unfair terms when it introduced ads to Prime Video in July 2024 to increase the monthly cost by $2.99 per month.
Amazon first announced it would introduce ads in 2023, and told users in mid-2024 that it wouldn’t increase the price of a subscription, but users could pay more for an ad-free service. At the time it said there would be fewer ads on Amazon compared to traditional broadcast TV.
“We allege that Amazon AU included multiple unfair terms in its contracts with Australian annual Prime subscribers, and it then relied on some of these terms to bring ads onto Amazon Prime Video,” ACCC Chair Gina Cass-Gottlieb said.
“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.”
The ACCC alleged that Amazon US was involved in drafting the Australian contracts that contained the terms which the ACCC says were unfair. The ACCC also alleges that Amazon US made the decision to introduce advertising to Prime Video globally and helped implement the decision in Australia.
“All businesses are required to balance rights and obligations in their standard form contracts with consumers to ensure they are fair,” Ms Cass-Gottlieb said.
“Contraventions of unfair contract term protections are subject to significant penalties. We strongly encourage all businesses, particularly those offering subscriptions, to review their contracts to ensure they comply with the Australian Consumer Law.”
