In the context of Liechtenstein, the word "small" refers only to the country's territory. The system of state works like that of other European countries, albeit considerably more quickly, simply, and directly. Nevertheless, Liechtenstein is different.
The Principality of Liechtenstein is a constitutional hereditary monarchy on a democratic and parliamentary basis. In the direct democratic system, the power of the state is divided between the Head of State, Reigning Prince Hans-Adam II von und zu Liechtenstein, and the people. Together, the 11 municipalities make up the sixth-smallest country in the world. 25 representatives elected by the people make up the Liechtenstein Parliament, or Landtag, and they appoint the five-member Government, which is confirmed by the Reigning Prince.
The 2013-2017 Government Program pays specific attention to the financial center: Both internationally and nationally, recent years have seen fundamental changes to the conditions in the financial industry. The Government therefore supports the process of adjustment in the financial center and attaches great importance to the close involvement of the financial center participants and regulatory implementation that is compatible with the country's size. The Government wants to ensure a high degree of legal certainty for the clients of the financial center and act in a forward-looking manner. This includes active positioning in the area of international tax cooperation, conscious optimization of the framework conditions, and positive positioning in regard to the country's image abroad.
The Reigning Head of State since 1989 has been His Serene Highness Reigning Prince Hans-Adam II. On 15 August 2004, he appointed his son, H.S.H. Hereditary Prince Alois, as his representative and entrusted him with the exercise of all sovereign rights to which he is entitled under the Constitution.
The Liechtenstein Parliament is composed of 25 MPs and is therefore small compared with other parliaments worldwide. Its main responsibility is to participate in the legislative process. Without the consent of Parliament, no law can be enacted or amended.