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The Channel Isles: Jersey (no, not that Jersey, although it is named after this island), Guernsey, Alderney and Sark. Also, Herm, which is small enough to be lumped in with Guernsey. These are British "Crown Dependencies", despite the fact that they are much closer to France.
You see, this dates from back in the days when the Kingdom of England was just one small part of a large Empire ruled by an ambitious French family, the Plantagenets (a.k.a. the Angevins). The French king didn't like the fact that one of his vassals owned more land than he did, so they went to war (the Hundred Years War... and several other wars). Eventually, the rulers of England lost all of their French territories except for the Channel Islands. And after that, the French and the English lived happily ever after and never quarrelled over anything ever again.
The Channel Islands were occupied by the Germans during the Second World War. They were so heavily fortified that the allies never attempted to recapture them; they were only liberated days after VE day. The occupation was harsh, but probably no worse than many other places under Nazi occupation, there was a small-scale resistance movement, and there was a daring British commando raid on Sark. The islands were ecstatically pleased to be liberated and that their evacuees could finally come home, and Liberation Day (or Homecoming Day) is a national holiday.
Today the islands are still littered with the remains of German fortifications, and there's at least one very good War Museum if you are into that sort of thing. The islands are also popular with tourists who like to hog the beaches, and popular with anyone who wants to avoid paying taxes. The islands don't pay any value-added tax on cheap items (under £20) imported or exported there either, so online CD and DVD retailers have made a killing by locating their offices there. However, this looks set to change with the closure of the UK VAT loophole from 1st April 2012, in order to provide a level playing field for UK-based retailers.
The "British Crown Dependency" thing means that the islands are not part of the UK. Queen Elizabeth II is the constitutional monarch (the only part of the Duchy of Normandy still held by the British crown); the isles are split into two different Bailiwicks (the Bailiwick of Guernsey includes Guernsey, Alderney and Sark, by the way); their parliaments do all of the day-to-day ruling. The UK government is responsible for the defence of the Channel Islands, for representing the Channel Islands on the international stage, and for the ultimate good governance of the Channel Islands (whatever that means).
Most of the fiction (and indeed non-fiction) involving the Channel Islands also involves the Second World War. There have been several documentaries on how people coped during the occupation, and several books dealing with the factual details of the occupation or stories of peoples' experiences of that time. An exception to this is the 1980s crime series Bergerac, set on Jersey. Also, the British writer John Christopher seems to have a fondness for the islands; at least two of his Cosy Catastrophe novels (Wrinkle in the Skin and The World in Winter) have some of their action centered there.
In 2008, Jersey was in the news a lot (in the UK at least) because of what appeared to be the remains of a child's skull found hidden within the grounds of a former childrens' home. There were fears that there may have been an organized "child abuse ring" and that the local authorities were being deliberately obstructive and attempting to cover this up. It was a piece of coconut.
Between 2002 and 2008 the Barclay Brothers'  attempted to take over the island of Sark and rule it as their Fortress of Solitude, as covered in Private Eye. They did this by getting the old feudal system abolished and thus bringing democracy to the island for the first time. However, the islanders promptly voted (in 2008) for whoever the Barclays didn't want.
The Channel Islands also have the smallest ITV franchise, Channel Television.
- Besides being the King of England, the head of the family was Lord of Ireland, Duke of Normandy, Duke of Aquitaine, Duke of Gascony, Count of Anjou, Count of Poitou, Count of Maine, Count of Touraine, Count of Saintonge, Count of Marche, Count of Perigord, Count of Limousin, Count of Nantes, and Count of Quercy, and had influence over the Duke of Brittany, the Duke of Cornwall, the King of Scotland, and the various petty principalities of Wales.
- Reclusive billionaires, owners of one of Britain's largest catalogue companies and the Daily Telegraph.