In recent years there has been a major expansion by higher education institutions in setting up "for-profit", offshore programmes and campuses. It has been claimed that for-profit provision in a free, or unregulated market, responds to student demand and acts as a catalyst for innovation, thus fuelling arguments for a global "free market"' in higher education. There are few opportunities to test these claims since higher education is overwhelmingly provided within national systems of education and is generally subject to strong local regulation. Israel, in the 1990s, offered a rare case of an unregulated market in higher education for foreign providers, albeit one which contained significant distortions: British institutions took the leading part in developments. This article examines that experience in the light of documentation in the public domain and of practitioner research and argues, contrary to unsubstantiated claims, that provision fell below acceptable standards. The article concludes that, in this field, consumer demand did not operate on the basis of quality and that the market-place cannot assure standards of higher education in overseas provision. Furthermore, until international standards are agreed, governments have a responsibility to regulate provision which directly affects the lives of their citizens.