WHEN imports are monopolistically supplied, the regulatory means which can be directed at a domestic monopolist are supplemented by possible trade policy measures. Thus it was proposed by Homi Katrak (1977) that the authorities in a small trading economy could use a tariff to counter the monopoly power of a foreign firm.' Katrak took the authorities' objective to be maximization of the sum of domestic consumer surplus and government revenue, and, on the assumption of a passive foreign response,2 demonstrated how a tariff could counter foreign monopoly power by balancing at the margin the loss in the domestic consumers' surplus against a gain in government revenue. Of course, in the absence of domestic production, a tariff is equivalent to an excise or consumption tax. A consumption tax is, however, generally not the most appropriate instrument for countering the monopoly power of a domestic firm, and likewise whether or not labelled a tariff is not the first-best means of countering the monopoly power of a foreign firm. As David De Meza (1979) quite appropriately pointed out with reference to the tariff proposal, the first-best means of regulatory control is in general independent of whether a monopolistically supplied good is produced abroad or domestically. In either case, a Pareto efficient competitive level of consumption might be attained via direct price controls, a subsidy to induce the monopolist to expand supply, or perhaps a graduated excise tax.3 However, as Katrak (1979) has argued (in response to De Meza), circumstances may be such that none of these policy options can be implemented. Still, in that case, if there is indeed no recourse other than the unilateral use of trade policy to counter foreign monopoly power, a government may nevertheless perhaps be able to do better than use a tariff. In this paper we extend the trade policy options of a small country confronting a foreign monopolist to encompass a quota as the instrument of intervention,