In most media, we hear about the activities of the Pope and the Catholic Church from ‘the Vatican’. In most government documents, you read about relations with ‘the Holy See’. As most people know that Vatican City is the world’s smallest sovereign country in both area and population, many assume that ‘Holy See’ must simply be a formal name for Vatican City. This is incorrect; Vatican City and the Holy See are two separate entities. It would be somewhat analogous to calling Germany ‘Bundestag’ or the Russian Federation ‘Duma’.
In simple terms, Vatican City State is simply the land granted to the Holy See for use as a sovereign, self-governing territory. The Holy See itself is the main diocese of the Catholic Church covering Rome, Vatican City, and the immediate surrounding land, much as any other diocese covers any other piece of territory. What separate this diocese or ‘see’ from the others is that the Bishop of Rome just happens to be the Pope; thus the See becomes the de facto central government for the entire church. As the place where the Pope sits is the seat of power in the Catholic Church, international relations with the church have always been conducted via the Holy See since the beginning of the church, long before the establishment of Vatican City in 1929 via the Lateran Treaty with Italy (Vatican City was essentially part of the compensation given to the Holy See for Italy’s 1870 annexation of the independent Papal States (the predecessor to Vatican City that covered all of central Italy) to complete the process of Italian unification.
In international law, the Holy See is essentially treated as a government without a state representing the nearly 1.2 billion Catholics around the world; a player on the international stage because of its unique history and status. Indeed, the Holy See itself holds permanent observer status at the United Nations, not Vatican City. Ambassadors from other nations are received by the Holy See, not Vatican City. The See is the organ that conducts diplomatic relations around the world; it is granted extraterritorial authority over 23 properties in Rome and five other properties in Italy just like any other country is granted authority over its embassies in other countries. But while it may possess the territory of Vatican City, the Holy See is not the government of Vatican City.
Vatican City State is an absolute theocratic monarchy in which the Pope may exercise complete control over the entirety of the State- all 44 hectares of it. Of course, the primary focus of the Pontiff is the operation of the Catholic Church. The Pope thus delegates legislative authority over Vatican City itself to the Pontifical Commission, seven cardinals appointed to five-year terms. The Commission passes laws which are then approved by the Pope via his appointed Secretariat of State. The executive functions of Vatican City are performed by the President of the Pontifical Commission. Under agreement with Italy, crime in Vatican City is prosecuted in Italian courts (as opposed to crimes within the church itself, which are tried by the Supreme Tribunal of the Apostolic Signatura (the Pope, a Prefect, and a Secretary).
Like any city or state (in this case, literally a city-state), Vatican City has its own police force (no to be confused with the Pope’s personal bodyguards, the Swiss Guard) and fire brigade, public works department, and health department. It also holds a monopoly on distribution of goods and services. Its most famous arm, however, may be its postal service. Other than voluntary tithing, Vatican City’s main source of income is its production of postage stamps and Euro coins (as well as souvenir sales to tourists), which are sought after by collectors the world over. Almost 2000 people are employed by the State, making Vatican City the only country on Earth where the labour force is more than twice the actual population size.
Cheney, D.M. (2010). Catholic-Hierarchy. Available at http://www.catholic-hierarchy.org/. Accessed 22 September 2010.
Gasparri, P. Cardinal & B. Mussolini (1929). Trattato fra la santa sede e l’Italia (Treaty between the Holy See and Italy). Rome, 11 February 1929. Available at http://www.vaticanstate.va/NR/rdonlyres/3F574885-EAD5-47E9-A547-C3717005E861/2528/LateranTreaty.pdf.Accessed 22 September 2010.
Uffici di Presidenza Stato della Città del Vatican (2010). State and Government. Available at http://www.vaticanstate.va/EN/State_and_Government/. Accessed 22 September 2010.