This article synthesizes the current debate on the need to address the issue of competition on global markets. It shows that negative externalities arise because at the same time that markets become more internationalised market governance remains in the scope of national competition authorities having limited territorial jurisdictions. Firms are thus in a position to engage, with impunity, in transnational anticompetitive practices that contradict the trade liberalization efforts of governments. This leads to allocative inefficiencies on world markets. Recent evidence suggests that transnational anticompetitive practices are more prevalent than was previously thought and that the magnitude of the costs that this entails, particularly for developing countries, is quite significant. Various types of remedies are conceivable. However, their adoption is unlikely or undesirable because most of these remedies either are incomplete or require national governments to relinquish their national sovereignty in this area. The EU is proposing the adoption of a competition agreement within the WTO. This proposal is compared to alternative solutions.
World Competition