The Galactic Constitution was signed in 25,053 BBY (Before the Battle of Yavin). This signing created the Galactic Republic, though at the time it was known as simply the Republic. During that time, a collaboration of Humans and Duros reverse engineered the technologies of the Rakata which led to the invention of the hyperdrive. This allowed Coruscant to become the capital of the Republic.
"Driving through Hyperspace ain't like dusting crops boy One wrong miscalculation and we could crash into a star or a meteorite and that would end this trip real quick."
- Han Solo to Luke Skywalker
Without proper hyperspace routes, traveling ships were unable to navigate safely. In response to this problem, two paths were mapped, the Perlemian Trade Route and the Corellian Run. One brought the Jedi Knights into the Republic, while the other allowed further expansion and exploration. These routes created what would become known as "the Slice."
Since the hyperspace of the galactic-west was anomaly-ridden and impassible for current Republic technology, "The Slice" became the site of the Republic expansion. The Core Worlds' portion of "The Slice" was known as the Arrowhead, and soon the Republic expanded into the Colonies.
The Republic would be the center point for many conflicts such as the Hundred-Year Darkness, the Old Sith Wars, the Vultar Cataclysm, the Mandalorian Wars, etc.
The Galactic Republic operated under a unicameral legislature. Each planetary government would send a representative to the Senate. Senators were considered to be ambassadors of their home worlds, and member worlds were able to maintain their government and society in accordance with local beliefs, customs, and traditions.
Senators received one vote in all matters procedural and substantive. The Chancellor was elected from within the Senate. The assembly was in turn divided into individual committees, each specializing in specific fields of government administration, and which were responsible for creating legislation to be reviewed by the full assembly.
Although legislation passed by the Senate was binding to all member worlds, most of the everyday legislation followed by citizens of the Republic was created at the planetary, sector, or regional level. Therefore, the main functions of the Senate were to mediate disputes between members, provide for the common defense, and regulate intersystem trade.
The above picture is an unidentified Mon Calamari who served as Supreme Chancellor for the Galactic Republic in the days leading up to the attack on Coruscant. The Chancellor was chosen from the Galactic Senate, elected by the other senators, and allowed to serve two four-year terms. The Chancellor could be removed from office at any time by the Senate with a Vote of No Confidence.
The Chancellor served to facilitate parliamentary procedure. He could also call an Extraordinary Session, which required all senators to attend and could circumvent minor aspects of the Senate's parliamentary procedure. He also was the head of the Senatorial Council.
A sub-department of the Supreme Chancellor was known as the Judicial Department and operated to provide legal advice to the those who required it. They also provided prosecutors and defense attorneys in court cases involving the Republic, investigated criminal activity occurring within Republic space, patrolled and policed Republic space, and coordinated activities with the Jedi Order.
Consisting of twelve justices, the Supreme Court composed the highest court in the Republic's government and was headquartered in the Galactic Courts of Justice Building on Coruscant. It served as a "court of last resort" and as a determiner of constitutional legality. The Supreme Court also tried cases involving the highest politicians and most noteworthy people in the Republic, however, some cases were handled by the Senate.
The standard currency in the Galactic Republic is the Republic dataries. Although thousands of currencies were used across the galaxy, the Galactic Republic's dataries were the most well known. Because of the Republic's large membership, dataries were accepted on all but the most remote planets. From its creation, the credit was backed by the immense wealth of the planet Muunilinst and the InterGalactic Banking Clan.
The Galactic Republic flourished through trade, such as interplanetary exports. Trading was conducted through both private and public firms.
That concludes my summary of the formation and operations of the Galactic Republic. Although the Galactic Republic was under constant threat of war and destruction, it still managed to survive. Perhaps this endearing trait will allow it to flourish, even though it is in a stalemate with the Sith Empire.
For those interested in more reading about the Galactic Republic, I suggest this article.
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