Australia's consumer watchdog has sued Amazon, alleging the tech giant used unfair contract terms to introduce adverts on Prime Video, leaving more than a million subscribers with little choice but to pay extra.
The Australian Competition and Consumer Commission (ACCC) claimed Amazon broke consumer protection law by inserting five unfair terms into contracts with annual subscribers between November 2023 and August 2025. Those terms, the regulator said, allowed Amazon to unilaterally make "materially adverse changes" to its services, including Prime Video, without offering refunds or other meaningful redress.
“Australia's consumer watchdog sues Amazon, alleging unfair contract terms forced Prime Video subscribers to pay more to avoid ads.”
"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," ACCC chair Gina Cass-Gottlieb said.
Prime Video had long been a commercial-free offering bundled with Amazon's Prime subscription, popular for its delivery perks. The service launched in Australia in 2018. By early 2024, Amazon began rolling out advertising globally. Australian subscribers were told they would need to pay an additional monthly fee to keep Prime Video ad-free, raising the price to A$12.99 (£6.70).
At that point, the ACCC noted, more than 850,000 Australians had already paid for a full year of Prime. "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 watchdog said in its court filing.
Amazon has faced regulatory heat before. In the US, the Federal Trade Commission has sued the company over allegations it signed people up for Prime without consent and made cancellation deliberately difficult. On Tuesday, Amazon also agreed to pay an FTC fine to resolve claims it created a "Kafkaesque ordeal" for victims of online shopping fraud.
In the UK, the government has previously investigated Amazon's method of listing goods for sale, and the proliferation of fake products on its marketplace.
A spokeswoman for Amazon told the BBC the company is "reviewing the case filed by the ACCC in detail". She added: "We have cooperated with the ACCC throughout its investigation and remain focused on providing the best experience for our Australian customers."
The case adds to a growing global scrutiny of how the tech giant treats its subscribers, with regulators on three continents now eyeing its practices.