Hi!
I just tried opening this link in Firefox and it complained that the XML file is not well-formed, at the first <wdt:Wikidata:P4 …> element. As far as I can tell, that’s correct according to Namespaces in XML 1.1 [1]:
Such URLs may be also problematic if we want to store it in WDQS - right now such URL would not be inlined properly, which means it would have significant storage and performance hits when using such URLs.
Also, wdt:Wikidata:P4 and wikidata's (or test wikidata instance's) wdt:P4 are different URLs, so one can not identify them as the same thing (despite them being the same thing in fact, that's the point of federation, as I understand). I think P4 should be http://federated-wikidata.wmflabs.org.wmflabs.org/prop/direct/P4 in this case (or, in case of real Wikidata federation, it would use actual wikidata URL of course).