Thanks for your additional explanation, I think I now understand what you are trying to achieve.

I don't think this constraint can be expressed in XSD 1.0. In XSD 1.1 it can be done with an assertion:

<xs:element name="Entity2">
 ...
 <xsl:assert test="empty(../Entity2)"/>
</xs:element>

Thanks for your additional explanation, I think I now understand what you are trying to achieve.

I don't think this constraint can be expressed in XSD 1.0. In XSD 1.1 it can be done with an assertion:

<xs:element name="Entity2">
 ...
 <xsl:assert test="empty(.//Entity2)"/>
</xs:element>