Communication will be with the player that owns the faction you wish to talk with, and all formal affairs will be carried out through PM. To PM, click on someones name or icon and hit message.
Alliances will be treaties of a friendly nature that both countries agree to. If you want a treaty with Babylon, then you will PM the leader (Vultbloop) and ask for a treaty. Treaties can have forms and agreements. A treaty might require one country to give 5 MEPs a day, or whenever someone attacks, they join. Any treaty that clarifies that they are in it together and are equals and will help eachother, is an alliance.