 The Liao employed two separate governments operating in parallel with one another : a Northern Administration in charge of Khitan and other nomadic peoples , most of whom lived in the northern side of Liao territory , and a Southern Administration in charge of the Chinese populace that lived predominantly in the southern side . When Abaoji first established the system , these two governments did not have strict territorial boundaries , but Emperor Shizong established formally delineated boundaries for the two administrations early in his reign . The newly delineated Northern Administration had large Chinese , Balhae , and Uighur populations , and was given its own set of parallel northern and southern governments . 
