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This paper concerns state-based systems that interact with their environment at physically distributed interfaces, called ports. When such a system is used a projection of the global trace, a local trace, is observed at each port. As a result the environment has reduced observational power: the set of local traces observed need not define the global trace that occurred. We consider the previously defined implementation relation ⊆s and prove that it is undecidable whether N ⊆s M and so it is also undecidable whether testing can distinguishing two states or FSMs. We also prove that a form of model-checking is undecidable when we have distributed observations and give conditions under which N ⊆s M is decidable. We then consider implementation relation ⊆sk that concerns input sequences of length κ or less. If we place bounds on κ and the number of ports then we can decide N ⊆sk M in polynomial time but otherwise this problem is NP-hard.