On the other side of the world, the Australian Wheat Board's (AWB) 67-year-old monopoly privileges are being whittled away, after an embarrassing and morally questionable oil-for-food kickback scandal involving Iraq's Saddam Hussein regime in the 1990s.

And Opec, that hoary mother of all cartels, may finally be seeing its petro-profits hitting less-than-fantastical levels as oil prices settle below US$60 a barrel - this after effectively losing control of the crude market to hedge-fund managers and speculators.

Looking back, it has been - to borrow a phrase from Queen Elizabeth II - septem dies horribiles: a vile and horrible seven days for monopolies, crypto-cartels and alleged market colluders.

The Oxford Dictionary of Economics defines a cartel as 'a formal or informal agreement between a number of firms in an industry to restrict competition'.

Such agreements can cover setting minimum prices, capping output or capacity, restricting non-price competition, dividing markets geographically or by product type or making it difficult for new players to enter the market.

The EU is particularly interested in the first form of agreement on prices as it suspects that a dozen airlines have colluded to fix surcharges for fuel, security and insurance in the US$50 billion air-cargo industry.

According to the airlines entangled in the investigations, the EU suspects air-cargo firms have been colluding for more than five years to set uniform levels of surcharges to cover the cost of added security after the 2001 terrorist attacks in the US, premiums for war-risk insurance after the Iraq war started in 2003 and higher fuel prices.

The antitrust case, tipped to start in April, could prove financially crippling as under European Union law, cartels can be fined as much as 10 per cent of their annual sales. In the US, prison terms can be levelled on top of massive penalties, not to mention civil damages.

In the AWB case, the scandal started to simmer last October when after 18 months of investigations, former US Federal Reserve chairman Paul Volcker issued his report on the UN oil-for-food programme for Iraq.

In essence, the Volcker report accused more than 2,000 firms of paying kickbacks to Saddam's regime between 1999 and 2003.

In a separate hearing in Australia, AWB officials subsequently admitted inflating the price of its wheat exports to Iraq and secretly channelling some US$221.7 million of 'rebates' from the oil sales to Saddam's regime.

Under intense pressure, AWB chief executive Andrew Lindberg quit on February 9.

The AWB - founded in 1939 as part of efforts to ensure wartime food security and privatised in 1999 - has been widely supported by Australian politicians and farmers who believe that the board can use its heft to provide affordable harvest loans to farmers and extract premium for the country's wheat exports.

But on Thursday, in the wake of Prime Minister John Howard's musings that AWB's monopoly may be reviewed after it was temporarily blacklisted by Iraq, Australian milling wheat futures prices jumped 2 per cent with traders seeing further rises if a bidding war breaks out among new players.

In a way, this indicates that Australian wheat farmers may not have been getting the best prices under the AWB's monopoly. The scandal also shows that its monopoly position can lead to corrupt business practices ultimately detrimental to the interests of Australian farmers. Since the inquiry started on January 16, AWB's share price has plunged 30 per cent, erasing more than A$700 million ($4 billion) off its market value.

Indeed, AWB is an anomaly in what the OECD considers to be the world's most deregulated economy.

Hong Kong, of course, is not free of cartels or the various forms of monopolies. In the case of the power sector duopoly, authorities can perhaps plug into the free-market structure adopted by the EU in 2003 for its US$297 billion power and gas markets, where industrial users - and soon households - can select from a menu of electricity suppliers.

In fact, Hong Kong already has a home-grown model: its highly efficient and viciously competitive telecommunications market where interconnection and portability have benefited consumers through lower prices and innovative services.

Supporters of cartels cite the benefits they offer as aggregators of supply and demand, leading to economies of scale and bulk savings. But the very nature of cartels can lead to distortions.

Fortunately, cartels contain their own cancerous seeds. Some cartel members, for example, may give secret price discounts or exceed production quotas covertly. In the end, greed and avarice - the same drives behind their conception - can also lead to their demise and destruction.