term for this is schismatic), but maintaining Valid Sacraments, rather than separated and theologically defective like Protestant denominations (the official theological term for this is heretical).
National Catholic churches originate from one of two historical sources. The older movement began in Europe at the conclusion of the First Vatican Council in 1869.
The chief concern of this Vatican Council was the promulgation of Papal Infallibility, a concept and doctrine which was strongly objected to by some bishops who saw it as over-reaching the traditional concept of the Pope as head of the College of Bishops and separating himself too independently from consultation with them. In reaction, some German theologians left the Roman Catholic Church and established a Catholic Church apart from Rome, with valid orders obtained through the schismatic Catholic Church in Utrecht, Holland. They differentiated themselves by keeping their doctrine to the "old practices" before the Vatican Council, hence they are known as Old Catholics. Today, in the United States, the largest successor to this movement is found in the Polish National Catholic Church, founded in 1898 as a federation of Polish parishes independent of the Roman Catholic Church, obtaining its valid Orders also through the schismatic Old Catholic Church of Utrecht. This church has recently reached an accord with the Roman Catholic Church allowing for an open Communion between the two churches.