More than a million Australian Amazon customers who paid for a yearly Prime subscription were left with a stark choice in early 2024: accept adverts in their previously commercial-free Prime Video service, or pay an additional monthly fee to remove them. The Australian Competition and Consumer Commission (ACCC) is now suing the tech giant, alleging it broke consumer protection law by imposing unfair contract terms on subscribers between November 2023 and August 2025.
“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,” said ACCC chair Gina Cass-Gottlieb. The watchdog claims Amazon used five unfair terms in its contracts with over a million customers, permitting the company to “unilaterally make materially adverse changes” to Prime Video and related services without offering subscribers refunds or “other meaningful redress.”
“Australia sues Amazon over unfair contracts that forced Prime Video subscribers to pay more to avoid ads.”
Amazon began rolling out advertising in Prime Video globally in early 2024. When it did, Australian subscribers were told they would need to pay an extra A$12.99 per month to keep the service ad-free. At that point, the ACCC said, more than 850,000 people had already paid for a full year of Prime. Those subscribers, the watchdog alleged, “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.”
A spokeswoman for Amazon said the company was “reviewing the case filed by the ACCC in detail,” adding that it had “cooperated with the ACCC throughout its investigation and remain focused on providing the best experience for our Australian customers.”
Amazon’s treatment of its users has drawn government scrutiny elsewhere. In the US, the Federal Trade Commission took legal action over claims the company enrolled people in Prime without their consent and made it difficult to cancel. This week, Amazon also agreed to pay a 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 platform.