I have version 11 and I can't get it to open. I don't think I have opened a password protected PDF in Xara before. Never had the need to.
However, when I try open this file in Xara I get the same message as you.... not given permission.

I just want to assign PW for a book so it's a little more inconvenient to distribute. I know there a digital delivery services that handle that but they charge too much.