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Even though public authorities, in particular the Government and the municipalities, may disturb effective competition by their exercise of public powers, the competition law does not apply to them, but for the specific and limited circumstances when it can be used in connection with other Treaty provisions. This article first explores the limits of applicability of EU competition law on public authorities; it concludes that even though EU competition law as such does not provide protection against conduct of public authorities distorting competition, its scope should not be expanded. The aim of competition law is to limit market power, not official authority. Instead, after discussing the legislation of selected countries from Central Europe, it is put forward that specific domestic legislation, applied by competition authorities, may provide an effective remedy to this problem. As comparative research of these issues has been rather limited so far, further elaboration of this topic is also suggested.