On 30 June 2026, the Australian Competition and Consumer Commission (ACCC) commenced proceedings against Amazon Australia, alleging that certain terms governing its Prime membership and Prime Video services constitute unfair contract terms under the Australian Consumer Law. According to the ACCC, Amazon relied on these terms between November 2023 and August 2025 to introduce advertising to Prime Video for more than one million subscribers with annual Prime memberships, without providing subscribers with any form of compensation. Since July 2024, subscribers who wished to continue using the service without advertisements have been required to pay an additional A$2.99 per month, despite having already paid an annual Prime membership fee of A$79.
The ACCC alleges that Amazon relied on contractual terms allowing it to make significant changes to Prime Video after consumers had entered into their subscription agreements. According to the regulator, the disputed terms allowed Amazon to introduce advertisements to Prime Video while requiring subscribers to pay an additional fee to continue accessing the service without advertisements. The proceedings are currently before the Federal Court of Australia, which will determine whether the disputed contractual terms are unfair under the Australian Consumer Law.
The proceedings come amid increasing regulatory and judicial scrutiny of changes to digital subscription services. In 2025, a United States federal court dismissed a proposed class action concerning Amazon’s introduction of advertisements on Prime Video, concluding that the company’s subscriber agreement permitted modifications to the service. The Australian proceedings differ in that they focus on whether the relevant contractual terms themselves are unfair under Australian consumer law rather than whether Amazon breached its subscription agreement.
Consumer protection authorities are increasingly examining how businesses exercise contractual rights to modify digital services after consumers have entered into a subscription agreement. The current proceedings may contribute to the developing approach to unfair contract terms in subscription-based digital services.
