The SerializationContext object controls the way in which XML is serialized/de-serialized. Its main role is to control the way in which validation is performed and which namespaces are output.
If this is not specified, the a default (SerializationContext.Default global static) instance of the class is used. If you are using several libraries generated from different schemas, or you want to change the way validation is performed for during the lifetime of the application or you are writing multithreaded code, then you should consider creating your own instance(s) of the SerializationContext.

The FIContext() method provides a FastInfosetContext structure which controls the way in which XML is serialized and de-serialized as a Fast Infoset document. It allows aspects of the Fast Infoset encoding to be changed for each Xml Data Type.

Note: If you are writing a multithreaded app it is highly recommended that you use a different instance of this class on each thread, as access to the static instance is not synchronized. Although read only operations to the static instance (SerializationContext.Default) of the class are thread safe, if the global instance SerializationContext.Default is modified, then this could potentially cause threading problems.

If the file already exists it is overwritten, if it does not exist it is created.
It will raise an exception if the XML within the object is not valid, i.e. invalid number of entries in a collection.

If the encoding is UTF-8 (the default) then the file is written out using the UTF-8 encoding scheme. It should be noted that UTF-8 encoding will encode  characters using 1-4 bytes. As such if the file is examined with a viewer that is not capable of decoding UTF-8, it will appear to contain odd characters. However if it is viewed with a compliant viewer (e.g. IExplorer) the file will appear as expected.
See Multi-Language Support for more information.

If the encoding selected is UNICODE, then the file is written out using 2 bytes per character. The standard 0xff 0xfe are placed at the beginning of the file to indicate to other applications that it is a UNICODE file.