The Pirate Towns, which call themselves the Free Lands of the Coast, broke away from the Hegemony of the Three Ethshars sometime around 5150 YS. This small country sits on one of the two large peninsulas along the coastline. The western peninsula is sort of at the southwest corner, and that's where they are.
Shan on the Sea, the largest and dominant of the Pirate Towns, is at the tip of the western peninsula, right on the headland. Theoretically, the Pirate Towns are run by a council of representatives from the various towns in a pattern of governance taken from the Baronies of Sardiron, but in practice Shan runs everything.