Board Thread:Questions and Answers/@comment-200.246.78.2-20151030140416/@comment-8695373-20151031123146

Seems like it. The game doesn't really give a clear description, and Library Mode of CPEX has only this:

"Those who Observe a subject. They must always perceive themselves, and must constantly perceive the 'existence' of their target subject. If not, they would instantly vanish, along with the 'existence' they are Observing."

As for example, Arakune exists as who he is because Kokonoe Observes him, preventing his seithr body from dissolving in the air.