Australia's competition regulator, the Australian Competition and Consumer Commission (ACCC), has initiated legal action against Amazon's Australian unit, alleging that the company included unfair terms in its Prime subscription contracts between November 2023 and August 2025 [1]. The ACCC claims these terms allowed Amazon to introduce advertising to its Prime Video streaming platform in July 2024, requiring more than a million annual Prime subscribers in Australia to either accept ads or pay an additional AU$2.99 ($2.05) per month for an ad-free experience, without the option for a refund if they chose to cancel their subscription [1].
Gina Cass-Gottlieb, chair of the ACCC, stated, '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' [1]. The ACCC is seeking consumer redress, penalties, costs, declarations, and other orders as part of its court action. The investigation was prompted by consumer reports following the introduction of ads to Prime Video in July 2024 [1].
Amazon Australia responded by saying, 'We are reviewing the case filed by the ACCC in detail. We have cooperated with the ACCC throughout its investigation and remain focused on providing the best experience for our Australian customers' [1].
Despite the legal action in Australia, Amazon's shares rose 3.2% on Monday, driven by reports of stronger-than-expected consumer demand during the company's extended Prime Day event in the U.S. According to Adobe Analytics, U.S. online shoppers spent more than $26.4 billion from June 23 through June 26 [1].
CONCLUSION
The ACCC's lawsuit against Amazon Australia highlights regulatory scrutiny over subscription contract terms and consumer rights. While the legal proceedings could pose reputational and financial risks for Amazon in Australia, the company's strong performance during Prime Day in the U.S. suggests continued robust consumer demand.