In federal countries, power is shared between a government for the whole country – which is sometimes called federal government, national government or Union government – and governments for federal units within this country. Federal units are also often called provinces, states or cantons. Federalism means the constitution divides power between at least two levels or orders of government.

Both orders have a direct electoral relationship with their citizens. In some federal countries, people also elect their local government, which may also be constitutionally recognized.

The federal government is responsible for common purposes for the whole country such as national defence, currency and foreign relations. The states or provinces are empowered to act within their areas of responsibility as it is described in the constitution. The federal government cannot arbitrarily take away the power of the federal units.

Watch this Forum of Federations animated video called, “What is Federalism?” to get a basic understanding of Federalism.