Amazon.com Inc. has been sued by Australia’s consumer watchdog for introducing advertising to its Prime Video streaming service and then forcing existing subscribers to pay more to avoid the ads.
The Australian Competition & Consumer Commission said Tuesday it has commenced proceedings in the Federal Court alleging Amazon breached consumer law by including unfair contract terms in its Prime subscription contracts. It also alleges Amazon later relied on those terms to introduce advertising to Prime Video in 2024.
More than one million subscribers, who already paid an annual upfront fee of A$79 ($54) for the service, then had no choice but to pay an additional A$2.99 a month to avoid the ads, the ACCC said.
The regulator also claims Amazon’s US headquarters was “knowingly concerned” about the Australian unit’s conduct in drafting the contracts and introducing advertising.
The ACCC is seeking penalties against Amazon and consumer redress.
Last year, Amazon agreed to pay $2.5 billion in penalties and refunds in the US and change its process for how to cancel its Prime subscription to settle a lawsuit by the Federal Trade Commission.
Photograph: The Amazon Prime Video logo displayed in a vehicle with built-in Amazon Alexa and Fire TV technology; photo credit: Patrick T. Fallon/AFP/Getty Images