In this pan zoom image, an Uber logo is seen outside the company's headquarters in San Francisco, California on May 8, 2019. (JOSH EDELSON / AFP)

Australia's competition watchdog is suing Uber Technologies Inc and seeking a A$26 million ($18.69 million) fine from the ride-hailing platform after it admitted to misleading consumers about ride fare estimates and cancellation fees.

The Australian Competition and Consumer Commission on Tuesday said Uber admitted that between December 2017 and September 2021 it warned consumers they would be charged fees for cancelling rides even though the cancellation was sought during its "free cancellation period"

The Australian Competition and Consumer Commission on Tuesday said Uber admitted that between December 2017 and September 2021 it warned consumers they would be charged fees for cancelling rides even though the cancellation was sought during its "free cancellation period."

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"Uber admits it misled Australian users for a number of years, and may have caused some of them to decide not to cancel their ride after receiving the cancellation warning, even though they were entitled to cancel free of charge under Uber's own policy," ACCC Chair Gina Cass-Gottlieb said.

The ACCC also said Uber admitted to have falsely represented fare estimates for its Uber Taxi option as its algorithm would almost always inflate the range and the actual fare would be lower than the company's cheapest estimate.

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"The misleading information on Uber's app deprived consumers of a chance to make an informed decision about whether or not to choose the Uber Taxi option," Cass-Gottlieb said.

The ACCC and Uber are jointly seeking court orders, including declarations that the ride-hailing platform breached the country's consumer law, and to impose upon it penalties, the regulator said further.

Uber was not immediately available for a comment outside of US working hours