Without pomp or circumstance the changes came into being on July 20, 2005. From the Yachtview (the Markish Prime Chancellor's residence), the leaders of Bendover, Marcusburg, and Smartaford, along with the quiet approval of the Lizbonnite charge d'affaires, signed the Lugano Pact which they hope will lead to a more cohesive and prosperous empire which the press has dubbed "the Markish Engine".

The countries of Adelanet, Kamostopol, and Matthewopolis have been merged into Bendover, Olisipo, and Smartaford respectively with Olisipo renamed Lizbonn to reflect the annexation. These three new countries would elect representatives directly to the Fletplase (Markish parliament), in addition to their own national assemblies, where they can influence policy across the entire empire.

The full independence of Bendover, Lizbonn, and Smartaford is restored as their heads of state acquire full control of their countries. Although government officials from Marcusburg may run daily affairs, the Bendovrite Emperor, Lizbonnite Empress, and Supreme Leader of Smartaford have the ultimate power of veto.

Furthermore, free trade pacts signed with Marcusburg now apply to all Lugano Pact members. Defense and foreign policy have also been harmonized.

However the Lugano Pact is not without its critics. They contend that these changes are overly centralizing. As such, they quash any chance of real independence for Bendover, Lizbonn, and Smartaford whose own heads of state remain just as apathetic about the fates of their people now as they did before the pact came into existence.