Berlin is its largest city, its capital and the seat of power. It is also the largest city in the European Union. The political system is federal, and takes a democratic, parliamentary republican form. Germany is divided into 16 federal regions, each of which has its own sovereignty and local government. Germany is located in central Europe, bordered to the north by: the North Sea, Denmark, and the Baltic Sea, to the south by: Austria and Switzerland, to the east by: Poland and the Czech Republic, and to the west by: France, Luxembourg, Belgium, and the Netherlands.