<grammar xmlns="http://relaxng.org/ns/structure/1.0" ns="urn:test:simple.rng">

  <start>
    <ref name="target1" />
  </start>

  <define name="target1">
    <grammar>
        <start>
            <ref name="<error>inner</error>" />
        </start>
    </grammar>
  </define>

  <define name="inner" />
</grammar>