In December 2025 the ACCC sued HelloFresh and Youfoodz, alleging that 62,061 HelloFresh customers and 39,408 Youfoodz customers were charged for a first order despite cancelling online before the advertised cut-off. It also alleges HelloFresh required card details just to see the full menu. The case landed as Australia legislated new subscription rules, which start on 1 July 2027.
Key takeaways
- The ACCC alleges 62,061 HelloFresh customers (Jan 2023 to Mar 2025) and 39,408 Youfoodz customers (Oct 2022 to Nov 2024) were charged after cancelling before the cut-off.
- It also alleges HelloFresh required payment details to view the full menu, and enrolled people in a subscription when they clicked through to choose meals.
- The Unfair Trading Practices Act 2026 received Royal Assent on 6 July 2026 and starts on 1 July 2027.
- From then, subscriptions need key terms at sign-up, prescribed notices, and an easy way to cancel. Reminder timing is left to regulations.
You've seen the ad. A big discount on your first meal kit.
You click through. You want to see what's on the menu before you decide. But to see the full menu, you have to enter your card details. That's fine, you think. The site says you won't be charged unless you choose meals.
You click to keep going. You look around. You decide it's not for you, and you cancel online, well before the cut-off.
Then the box arrives. And the charge.
According to the ACCC, that's roughly what happened to tens of thousands of Australians.
What does the ACCC allege?
In December 2025, the ACCC started separate Federal Court proceedings against HelloFresh (Grocery Delivery E-Services Australia) and Youfoodz, both owned by HelloFresh SE, over alleged "subscription traps."
| HelloFresh | Youfoodz | |
|---|---|---|
| Customers allegedly charged despite cancelling before the cut-off | 62,061 | 39,408 |
| Period | 1 January 2023 to 14 March 2025 | 1 October 2022 to 22 November 2024 |
The ACCC alleges:
- both companies told new customers they could cancel online before a specified cut-off for the first order, but many who did were still charged and sent that order. The first delivery could allegedly only be cancelled by speaking to customer service;
- HelloFresh required payment details just to view the full menu, while telling people they wouldn't be charged unless they selected meals;
- clicking to continue enrolled people in an ongoing subscription and charged them for the first delivery;
- Youfoodz customers who cancelled in their account settings were told the first delivery was cancelled, but it wasn't.
Many people didn't realize they'd subscribed until a delivery or payment notice arrived. The ACCC opened its investigation in October 2024 after "a large number of consumer complaints."
These are allegations. As at October 2026, the court hadn't decided the case.
How did this case connect to the new law?
Timing.
| Date | What happened |
|---|---|
| October 2024 | ACCC opens its HelloFresh investigation |
| 23 November 2025 | Government announces it will legislate against unfair trading practices |
| December 2025 | ACCC sues HelloFresh and Youfoodz |
| 9 February 2026 | Treasury releases an exposure draft |
| Early July 2026 | Parliament passes the Bill |
| 6 July 2026 | Royal Assent: the Unfair Trading Practices Act 2026 |
| 1 July 2027 | New rules start |
Assistant Minister Andrew Leigh described a subscription trap as one where "joining is swift and effortless while leaving involves added frictions." The HelloFresh case, as alleged, is a textbook example.
What will the law require from July 2027?
In short:
- disclose key terms at sign-up, prominently, including that it's a subscription, the price, renewal and how to cancel;
- give prescribed notices during the subscription. The final Act leaves the timing and content to regulations. The Parliamentary Library's examples include before a free trial ends, at renewal and when prices change. As at October 2026, those regulations hadn't been published;
- provide an easy, straightforward way to cancel, and an online way if customers can sign up online;
- don't manipulate consumers or distort their decisions in ways that cause harm.
Some of these protections extend to small-business subscribers too. The full detail, and what's still uncertain, is in Australia's subscription trap laws.
Would your sign-up flow pass?
Check your sign-up, reminder and cancellation flow against Australia's new subscription rules in a few minutes.
Why do subscription boxes fall into this trap?
Because the first box is where the money is lost.
In The Subscription Playbook I explain that subscription boxes rely on volume. You buy wholesale because you're sending out thousands of the same box. If you don't have a plan to reach that volume, I wrote, this model may not be right for you.
That pressure pushes businesses toward aggressive "first order" funnels: a big discount, card details early, a cut-off that's easy to miss. A heavily discounted first box can cost more than it earns, so every customer who cancels before it ships feels like a loss.
But a customer who's charged after cancelling isn't a customer. They're a complaint, a chargeback and a one-star review. And in Australia, potentially a regulator's case.
My take
If your acquisition model only works when people fail to cancel in time, you don't have an acquisition model. You have a leak you're calling revenue. Fix the offer so the first box is worth paying for, and the second box sells itself.
What can you steal from the HelloFresh case?
- Let customers browse before asking for card details. Show the menu, the price and the plan first.
- Make subscribing unmistakable. A clear statement that this is a subscription, right next to the button.
- If you have a cut-off, make it work. Cancelling before it must stop the charge. Confirm it by email straight away.
- Let people cancel the way they joined. If they signed up online, they should be able to cancel online, including the first delivery.
- Build trial-end and renewal reminders into your billing now, with timing you can adjust once the regulations are published.
Start with the free trial reminder templates and work through the AU subscription compliance checklist. The cancellation rules guide and what the ACCC expects cover the rest. If you run a box business, the subscription boxes model guide shows how to make the economics work without relying on missed cut-offs.
What to do next
Go through your own sign-up as a brand-new customer. Then cancel before your cut-off. Did the charge stop? Did you get a confirmation?
If you're not sure, test it before 1 July 2027. Better still, test it this week.
AU Subscription Compliance CheckerCheck your sign-up and cancellation flow against the new Australian rules.Open the free tool →Frequently asked questions
What is a subscription trap?
A subscription trap is a subscription that's far easier to start than to stop. Common examples include sign-ups that don't make clear you're subscribing, free trials that convert without warning, and cancellation that only works by phone or doesn't actually stop the charge. Assistant Minister Andrew Leigh described it as joining being swift and effortless while leaving involves added frictions.
Has the court decided the HelloFresh case?
As at October 2026, I couldn't find a decision. The ACCC's claims are allegations that the Federal Court has yet to determine. The ACCC is seeking compensation for affected consumers, penalties, declarations, publication orders, a compliance program and costs.
Can a subscription box still ask for card details upfront?
Taking payment details at checkout is normal. The problem alleged in the HelloFresh case is asking for them just to see the menu, while telling people they wouldn't be charged, and then treating a click as joining a subscription. Let people browse freely, and make it unmistakable when they're actually subscribing.
Do the new rules cover meal kits?
Almost certainly, if the service keeps delivering and billing until the customer stops it. The Act covers indefinite subscriptions, fixed terms that roll over, free trials and discounted intro periods. Exclusions include leases, hire purchase, instalment contracts, childcare and school tuition. Meal kits, boxes and memberships aren't excluded.
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Robert Coorey, MBA
Robert is the author of The Subscription Playbook and Feed a Starving Crowd and a Director at BPAG Accountants in Sydney. More about Robert.
Sources
- ACCC, HelloFresh and Youfoodz in court over alleged subscription traps (Dec 2025)
- The Guardian, HelloFresh and Youfoodz sued by ACCC (16 Dec 2025)
- Treasury, Unfair trading practices exposure draft (9 Feb 2026)
- Parliamentary Library, Bills Digest, Competition and Consumer Amendment (Unfair Trading Practices) Bill 2026
- Competition and Consumer Amendment (Unfair Trading Practices) Act 2026 (No. 64, 2026), Federal Register of Legislation
- Bird & Bird, Australia's Unfair Trading Practices Laws Pass Parliament (10 Jul 2026)
- King & Wood Mallesons, Unfair trading practices: Arriving mid-2027 (2026)
Facts and prices checked 27 October 2026. Spotted something out of date? Tell us.