It depends on the server.
You can always change factions later. Just remember any faction perks you had will be useless and if you drop your pilot squadron you loose all your skills and experience and have to start from scratch.
I've done it, I was a Rebel Colenel(sp?) and went Imperial cause I wanted to do the Imperial theme park. Once I finished all the Imperial quests I could find I dropped that and I'm neutral at the moment.
I also changed pilot squadrons as I didn't like the one I was in. I didn't loose much however, I was only 1100. That's how I got an Imperial pilot with a mercenary bandolier. I took it off and now I can't put it back on though.