All empires have a government, ranging from Anarchy to Dictatorship. The difference between each type of government is only the way officials are elected. For example, in an Anarchic government anyone may request any government position, including that of the emperor, whereas in a Democratic empire whenever a certain position is requested, all citizens are able to cast a vote for the player they deem worthy to hold said position.
Relations and DefenseEdit
Empires have 4 different views they can take of one another: Friendly, neutral, enemy, and vassal. The relationship between two empires is determined separately by each empire; you could be neutral to someone who is friendly to you, or an enemy of someone who is neutral. For friendly and neutral, the main difference between them is what the empire is allowed to access inside the other's cities and systems, and that is set via the commerce screen. If the commerce screen hasn't been edited, then there shouldn't be any real difference between being friendly and neutral towards an empire.
If two empires are enemies of each other, their planetary stations, AI officered ships, player ships, and eventually defense bases will open fire on each other on sight. Ships with turrets should fire their turrets at enemy ships even without an AI officer, but this is not verified. This is essentially being at war with that empire. Also note that each world may have one orbiting station that will automatically fire its weapon systems at enemy ships without an AI officer on board, but for additional stations you need to station an officer aboard one of them. One item of note, is that at this time your empire will not automatically change to being an enemy of another, even if you are fired upon or have cities captured by that empire. Exploiting this is generally frowned upon, and is probably not a wise thing to do. Also it's just not cool. Man up, and declare war properly if you want to fight someone or take their stuff. This is something the devs plan to fix, hopefully in the near future.
A Vassal is a unique status with another Empire. An Empire that is a Vassal to another pays tribute (can be set in Empire Policies page) to the other Empire. This state usually implies a type of protection by the larger Empire. It can also possibly be used by a conquering Empire to subjugate other Empires without completely destroying them, which is both more kind as well as eliminating management for the conquering empire.
An Ally is another unique status with another empire. The smaller empire appears similarly to a vassal, underneath the larger one (determined by number of controlled sectors). As with a vassal, the statistics of the smaller are added to the larger on the empire rankings page. Unlike a vassal, it is free of any negative connotations and no tax can be paid.