Australia Targets Subscription Traps With Massive New Fines
A new Australian law effective July 2027 will impose penalties of up to $100 million or 30% of turnover for unfair trading practices, including subscription models with unclear auto-renewal and cancellation terms.
Australia's Parliament has passed the Competition and Consumer Amendment (Unfair Trading Practices) Act 2026, introducing a broad prohibition on unfair trading practices and specific new rules for subscription services, effective July 1, 2027. The law creates a significant new enforcement risk for businesses, with corporate violations attracting civil pecuniary penalties of the greater of $100 million, three times the benefit obtained, or 30% of adjusted turnover during the breach period. This marks a substantial shift from the prior Australian Consumer Law, under which some forms of misleading conduct did not carry financial penalties.
A recent Federal Court ruling against dating site eHarmony illustrates the conduct targeted by the reforms. The court found eHarmony misled consumers about its automatic subscription renewals, pricing, and cancellation policies. Under the new regime, such practices will face the dramatically increased penalties. Companies offering subscriptions to Australian consumers should proactively review their disclosure of renewal terms, pricing transparency, and cancellation processes to ensure compliance before the law takes effect next year.