Flags are just "marks" (so to speak) on your account that you completed some task. To enter various PoP zones, you have to be flagged as having completed some quest (usually involving killing a raid mob and hailing a projection), to get your LDoN adventurer's stone, you have to be flagged as having spoken to your home town NPC, etc.
How you get the flag depends entirely on which flag you're talking about.
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Belkira wrote:
Wow. Regular ol' Joph fan club in here.