Amazon hauled to Federal Court as Australia's consumer watchdog challenges Prime Video advertisements

By CAITLIN POWELL - NEWS REPORTER and AUSTRALIAN ASSOCIATED PRESS Published: 00:41, 30 June 2026 | Updated: 00:59, 30 June 2026 Amazon is facing Federal Court action from Australia's consumer watchdog over advertisements introduced on Prime Video. The Australian Competition and Consumer Commission (ACCC) confirmed on Tuesday that it was launching legal proceedings against Amazon AU. The watchdog alleges the company's commercial practices breached Australian consumer law 'by including unfair contract terms in its Prime subscriptions contracts, and later relying on those terms to introduce advertising to its streaming service, Amazon Prime Video'. The lawsuit alleges contracts with over one million Prime subscribers contained five unfair contract terms, one or more of which it relied on to introduce ads in July 2024. After July 2024, subscribers who wanted to stay ad-free had to pay an additional $2.99 per month, despite already having paid $79 for the year upfront. '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.' It is alleged Amazon US was involved in drafting the Australian contracts that contained the terms which the ACCC says were unfair and made the decision to introduce advertising to Prime globally. Amazon is facing Federal Court action from Australia's consumer watchdog over advertisements introduced on Prime Video (stock image) ACCC Chair Gina Cass-Gottlieb (pictured) said 'consumers who wanted to avoid ads were left with no choice but to pay more' due to changes to contracts An Amazon Australia spokesperson said the company is reviewing the Federal Court case in detail (Pictured, Amazon headquarters in Melbourne) '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. The watchdog is seeking penalties for Amazon and consumer redress, among other remedies. The ACCC investigated Amazon AU's contracts after receiving consumer reports about the introduction of ads to Prime. An Amazon Australia spokesperson said the company is reviewing the case in detail. 'We have cooperated with the ACCC throughout its investigation and remain focused on providing the best experience for our Australian customers,' they said. Sorry we are not currently accepting comments on this article.