James VIII inherited the Celtic Throne at a prosperous and proud time for the Celts. Their Empire had just recently gained control of the island of Sri Lanka, giving Celtica an inroad on the lucrative Indian markets. Their colonial Empire overseas was growing merrily, with each colony gaining more ability to work as a nation, but still remaining largely loyal to the Celts. Celtic culture had also gone through a renaissance, with Scots Gaelic having become a lingua franca of the Celtic Empire, although the local dialects remained strong. Cornish, Manx, Welsh, Irish, and Breton were all widely spoken in their home nations. England kept speaking English, although it had absorbed many Celtic words, transitioning from Middle English to Modern English through a synthesis of itself with the various Celtic languages that were spoken across the Celtic Empire. Edinburgh had grown to be large enough to rival London in size, and the Empire as a whole had grown into the richest nation in Europe.
In 1705, Henri IV died, and his Protestant son Henri V came to the throne of France. The Papacy finally grew tired of France, and excommunicated the whole nation. Many French Catholics were aghast at the pettiness of the Catholic Church, and many renounced it entirely. With this, Henri V was able to officially sever France from the Catholic Church, and created the Church of France. With this, Spain and Portugal remained the last major holdouts of Catholicism in Western Europe. In the east, Eastern Orthodoxy was taking further hold, slowly becoming ever more powerful in the Polish-Lithuanian Commonwealth and starting to regrow in the face of the Sunni Muslim Ottoman Empire, whose Empire was slowly crumbling from the Balkans. Catholicism remained strong in Italy, southern Germany, Iberia, and the northern Balkans.
A new change came to pass in 1706. In that year, the Celts offered Morocco the sum of 100,000 Celtic Knots for the purchase of the small port town of Sabta, on the southern coast of the Straits of Gibraltar. Morocco, however, wanted another concession. Morocco had undergone several "westernization" efforts, and had come to see a colony in the new world as one of the best ways to be seen as an equal of the European powers. Seeing the chance to gain a strategic ally in North Africa, James VIII agreed to the sale. Sabta became a Celtic port, and the governor of Meridia was convinced to sell a small, 100 square kilometer territory in his nation that had remained unpopulated to become a Moroccan colony. In 1708, the first Moroccan colonists traveled to the newly named "Fas Aljadid", "New Fez". Upon their arrival, they constructed the first mosque in the new world.
The Celts had been exploring the western coast of North America for some time, and the Spanish had laid claim to nearly the entire west coast as part of their colony of New Spain. However, this claim was largely in name only. James VIII decided to undertake the task of actually colonizing this area. The most ideal place was what the Spanish called the "San Francisco Bay", and was thus marked for colonization by the New Caledonia Company, establishing the town of Saint Andrew at the mouth of the entrance of the bay. Spain protested, but its colonies began heaving again, and its attention was drawn away. As such, the colony of New Caledonia grew peacefully.
At home, France and Celtica banded together with Denmark to form the Triple Alliance, the most powerful alliance in all of Europe, bound together on their Protestant faiths. With this strength, Queen Margrethe II was able to unify the crowns of Denmark, Norway, and Sweden into the Empire of Scandinavia, which adopted a near-federal system much like the Celts had during the formation of their own Empire. Scandinavia then laid claim to Greenland as its own colonial dominion, claiming it as part of its Viking heritage. In the same vein, Scandinavia also laid claim to the island of Newfoundland, claiming it as the land of Vinland that Leif Erikson had discovered long before Columbus had stumbled across the New World. Several minor settlements had been created in Newfoundland by Nova Scotia, but they had never lasted terribly long. Because of this, it was easy to officially transfer Newfoundland to being Vinland. The Scandinavians were thus forming their own colonial Empire, several centuries behind the rest of Europe.
The reign of James VIII saw a peace in all of Celtdom that lasted through the end of his reign. In 1721, James VIII died, and left in his will that he wanted his daughter, the Princess Mary, to become the next Empress Regnant. The Rìoghail Chòmhdhail, the parliament of the Empire, accepted the accession of Mary to become Empress, but her younger brother Connor refused to accept it. On the day of Mary's coronation, Connor declared an open rebellion against his sister, proclaiming himself Connor I, Emperor of all Celts. A new civil war had begun.