My impression so far is that you will be able to set some sort of rules applying to the land you "own" and build your city on (this area should expand with every building you construct in close proximity to another building already existing, imo).
With "rules" I mean things like...
... you can only "enter" the city unarmed, leading to your weapons being automatically taken from you by the server when you walk through the gates.
... the "tax" rate they mentioned concerning the amount of labor force every crafting citizen has to give to the local ruler (which is also automatically subtracted from the amount you produce or the trades you do).
... who can construct buildings in separate sections of your city.
... how many of your family members (assuming your whole family lives in this place) can be used as soldiers during times of war.
... which kind of goods you are allowed to produce within the city borders.
... and so on
No one is needed to enforce these rules within a city because they are set by the ruler and restrict or allow certain gameplay mechanics while you are in the town or city. On top of that, if your local ruler is only a small lord belonging to a bigger kingdom, the king or marshal might also set some rules applying to his whole kingdom / area of influence (at least to all cities or villages belonging to his dominion).
This is the kind of "metagame" associated with being an empowered person in OKAM... That's how I understood it so far.
This is necessary due to the fact that Taser is right, there will definitely not be enough people willing to do the boring RP tasks needed to carry all this out with players only.
So, who's the ruler? An admin? chadz? 
I like what Salvius says. Things such as taxes should be automatic as collecting in a video game would be tough. And an 'automatic gate' would make life easier.
As for who 'rules', ya, that's more complicated. I suppose it could be by agreement. Just a dialogue box where you hit 'accept' when someone asks for 30% of your income. You could always say 'no' provided you accept the circumstances.
This would allow for a more feudal society. As the player base grows, the layers of society will grow too. If you own a large tract of land you could get 3 other players farming on it as well, and you collect 30% off each. With that money you could build a keep for storage and a place of safety for your farmers, and you'd do what you can to ensure they succeed as you get a cut.
And perhaps you'd also have to pay a percentage to a nearby town ruler for 'protection'. In the town there would be rents on shops and houses to be collected, and a sales tax on goods exchanged there. The rents, and the gatehouse rules, would be controlled by whoever built the walls (or claimed ownership). Since there might be a bit of back and forth, perhaps the money and the controls would be in the gatehouse which could be accessed only by the owner, or by force... perhaps possession of it for a day or two til you have full control over it.
Sales tax would go to whoever keeps trade safe between the cities. I would think this would be the king... or President or Grand High Dragon Wizard or whatever you want to call it. Market places are established in towns by said ruler with the 'accept' dialogue between him and the town ruler. The idea is he'll ensure authorized caravans can travel safely.
I think there should be a lot of tax as only organized groups should be able to afford the really good armour and siege equipment etc. We don't want a guy to sell his first harvest and buy full plate then go killing noobs (a guy who wants to be a bandit should be armed like a bandit in WB single player). But we do want guys fighting big battles in good gear which would be returned... unless the guy decides to desert... so don't equip new players with your best gear.
For all you anachronists out there that want a democracy or theocracy or whatever can still vote who your leaders are, but you'll just have to trust him once he's in that he won't enact martial rule.
