3. USE 2--3 BASIC
COLORS

Limit the number of colors on the flag to three, which contrast well and come from the standard color set…
The basic flag colors are Red, Blue, Green, Black, Yellow, and White. They can range from dark to light. Occasionally other colors are also used, such as Purple, Gray, and Orange, but they are seldom needed in a good design.
Separate dark colors with a light color, and light colors with a dark color, to help them create effective contrast. A good flag should also reproduce well in "gray-scale", that is, in black & white shades.
More than four colors are hard to distinguish and make the flag unnecessarily complicated and expensive. Flag fabric comes in a relatively limited number of colors—another reason to stick to the basics.

 

GOOD BAD

Amsterdam (Netherlands)

Chinese Admiral (1882)
These colors contrast well, even though the red and black are not separated by a light color. Too many colors! At the least, the yellow and white should be separating the dark colors.
While the dragon is the in the position of honor, it is very hard to distinguish.

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(GFBF Directory)