[BUG] @imports in CLAUDE.md files outside the git repo root are not resolved

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

When CLAUDE.md files exist in parent directories above the git repo root, the harness finds and loads them correctly, but does not resolve @filename imports in those files. Only the @ import at the git repo level is resolved. The parent-level CLAUDE.md files show the raw literal text @AGENTS.md instead of the referenced file's content.

What Should Happen?

All @AGENTS.md imports should be resolved at every directory level where the harness loads a CLAUDE.md file, as long as the referenced file exists relative to that CLAUDE.md.

Error Messages/Logs

Session context shown at startup:


Contents of ~/CLAUDE.md (project instructions, checked into the codebase):
@AGENTS.md

Contents of ~/src/CLAUDE.md (project instructions, checked into the codebase):
@AGENTS.md

Contents of ~/src/some-project/CLAUDE.md (project instructions, checked into the codebase):
@AGENTS.md

Contents of ~/src/some-project/AGENTS.md (project instructions, checked into the codebase):
[full content loaded here]


Only the git repo-level AGENTS.md was resolved. The parent-level `@AGENTS.md` references were passed through as raw text.

Steps to Reproduce

1. Create the following file structure:

~/AGENTS.md                  # file with some instructions
~/CLAUDE.md                  # contains only: @AGENTS.md
~/src/AGENTS.md              # file with some instructions
~/src/CLAUDE.md              # contains only: @AGENTS.md
~/src/some-project/AGENTS.md # file with some instructions
~/src/some-project/CLAUDE.md # contains only: @AGENTS.md

1. Initialize a git repo in ~/src/some-project/ (the other directories are not git repos).
2. Run claude from ~/src/some-project/.
3. Observe the session context: only ~/src/some-project/AGENTS.md content is loaded. The parent CLAUDE.md files show @AGENTS.md as literal text.

Claude Model

Opus

Is this a regression?

I don't know

Last Working Version

_No response_

Claude Code Version

2.1.110

Platform

Anthropic API

Operating System

macOS

Terminal/Shell

Other

Additional Information

Workaround

Replace each CLAUDE.md with a symlink to AGENTS.md:

ln -sf AGENTS.md CLAUDE.md

The harness then reads the content directly without needing @ resolution.

Terminal/Shell

Ghostty with Fish