It's not well-formed.
From the XML 1.0 spec [1]:
"It is a fatal error if an XML entity is determined (via default, encoding declaration, or higher-level protocol) to be in a certain encoding but contains byte sequences that are not legal in that encoding."
Unless of course there is a "higher-level protocol" that tells you it's really a different encoding. (The term higher-level protocol is not really defined. I think they had in mind the media-type from the HTTP content header. In terms of the protocol stack, that of course is a lower-level protocol. But it's sufficiently woolly that a phone call from the sender to say "Oops, I meant EBCDIC" would be enough to make the document well-formed.Regards,
Michael Kay
http://www.saxonica.com/
http://twitter.com/michaelhkay