diff --git a/include/linux/capability.h b/include/linux/capability.h
index 8961e7fb755c..7a8d7ade28a0 100644
--- a/include/linux/capability.h
+++ b/include/linux/capability.h
@@ -310,10 +310,6 @@ typedef __u32 kernel_cap_t;
 #define CAP_SETFCAP	     31
 
 #ifdef __KERNEL__
-/*
- * Bounding set
- */
-extern kernel_cap_t cap_bset;
 
 /*
  * Internal kernel functions only
diff --git a/include/linux/security.h b/include/linux/security.h
index 9b0b63c50f44..ff3f857f6957 100644
--- a/include/linux/security.h
+++ b/include/linux/security.h
@@ -34,6 +34,13 @@
 #include <linux/xfrm.h>
 #include <net/flow.h>
 
+/*
+ * Bounding set
+ */
+extern kernel_cap_t cap_bset;
+
+extern unsigned securebits;
+
 struct ctl_table;
 
 /*
diff --git a/kernel/capability.c b/kernel/capability.c
index 4e350a36ed6a..14853be5944d 100644
--- a/kernel/capability.c
+++ b/kernel/capability.c
@@ -3,7 +3,7 @@
  *
  * Copyright (C) 1997  Andrew Main <zefram@fysh.org>
  *
- * Integrated into 2.1.97+,  Andrew G. Morgan <morgan@transmeta.com>
+ * Integrated into 2.1.97+,  Andrew G. Morgan <morgan@kernel.org>
  * 30 May 2002:	Cleanup, Robert M. Love <rml@tech9.net>
  */ 
 
@@ -14,9 +14,6 @@
 #include <linux/syscalls.h>
 #include <asm/uaccess.h>
 
-unsigned securebits = SECUREBITS_DEFAULT; /* systemwide security settings */
-kernel_cap_t cap_bset = CAP_INIT_EFF_SET;
-
 /*
  * This lock protects task->cap_* for all tasks including current.
  * Locking rule: acquire this prior to tasklist_lock.
diff --git a/kernel/sysctl.c b/kernel/sysctl.c
index c25e67e19af7..067554bda8b7 100644
--- a/kernel/sysctl.c
+++ b/kernel/sysctl.c
@@ -24,7 +24,7 @@
 #include <linux/slab.h>
 #include <linux/sysctl.h>
 #include <linux/proc_fs.h>
-#include <linux/capability.h>
+#include <linux/security.h>
 #include <linux/ctype.h>
 #include <linux/utsname.h>
 #include <linux/smp_lock.h>
@@ -371,6 +371,7 @@ static struct ctl_table kern_table[] = {
 		.proc_handler	= &proc_dointvec_taint,
 	},
 #endif
+#ifdef CONFIG_SECURITY_CAPABILITIES
 	{
 		.procname	= "cap-bound",
 		.data		= &cap_bset,
@@ -378,6 +379,7 @@ static struct ctl_table kern_table[] = {
 		.mode		= 0600,
 		.proc_handler	= &proc_dointvec_bset,
 	},
+#endif /* def CONFIG_SECURITY_CAPABILITIES */
 #ifdef CONFIG_BLK_DEV_INITRD
 	{
 		.ctl_name	= KERN_REALROOTDEV,
@@ -1872,10 +1874,11 @@ static int do_proc_dointvec_bset_conv(int *negp, unsigned long *lvalp,
 	return 0;
 }
 
+#ifdef CONFIG_SECURITY_CAPABILITIES
 /*
  *	init may raise the set.
  */
- 
+
 int proc_dointvec_bset(struct ctl_table *table, int write, struct file *filp,
 			void __user *buffer, size_t *lenp, loff_t *ppos)
 {
@@ -1889,6 +1892,7 @@ int proc_dointvec_bset(struct ctl_table *table, int write, struct file *filp,
 	return do_proc_dointvec(table,write,filp,buffer,lenp,ppos,
 				do_proc_dointvec_bset_conv,&op);
 }
+#endif /* def CONFIG_SECURITY_CAPABILITIES */
 
 /*
  *	Taint values can only be increased
diff --git a/kernel/sysctl_check.c b/kernel/sysctl_check.c
index f47c33d17032..3c9ef5a7d575 100644
--- a/kernel/sysctl_check.c
+++ b/kernel/sysctl_check.c
@@ -38,7 +38,10 @@ static struct trans_ctl_table trans_kern_table[] = {
 	{ KERN_NODENAME,		"hostname" },
 	{ KERN_DOMAINNAME,		"domainname" },
 
+#ifdef CONFIG_SECURITY_CAPABILITIES
 	{ KERN_CAP_BSET,		"cap-bound" },
+#endif /* def CONFIG_SECURITY_CAPABILITIES */
+
 	{ KERN_PANIC,			"panic" },
 	{ KERN_REALROOTDEV,		"real-root-dev" },
 
@@ -1532,7 +1535,9 @@ int sysctl_check_table(struct ctl_table *table)
 			    (table->strategy == sysctl_ms_jiffies) ||
 			    (table->proc_handler == proc_dostring) ||
 			    (table->proc_handler == proc_dointvec) ||
+#ifdef CONFIG_SECURITY_CAPABILITIES
 			    (table->proc_handler == proc_dointvec_bset) ||
+#endif /* def CONFIG_SECURITY_CAPABILITIES */
 			    (table->proc_handler == proc_dointvec_minmax) ||
 			    (table->proc_handler == proc_dointvec_jiffies) ||
 			    (table->proc_handler == proc_dointvec_userhz_jiffies) ||
diff --git a/security/commoncap.c b/security/commoncap.c
index 778cb0cfc5d8..48ca5b092768 100644
--- a/security/commoncap.c
+++ b/security/commoncap.c
@@ -24,6 +24,25 @@
 #include <linux/hugetlb.h>
 #include <linux/mount.h>
 
+#ifdef CONFIG_SECURITY_FILE_CAPABILITIES
+/*
+ * Because of the reduced scope of CAP_SETPCAP when filesystem
+ * capabilities are in effect, it is safe to allow this capability to
+ * be available in the default configuration.
+ */
+# define CAP_INIT_BSET  CAP_FULL_SET
+#else /* ie. ndef CONFIG_SECURITY_FILE_CAPABILITIES */
+# define CAP_INIT_BSET  CAP_INIT_EFF_SET
+#endif /* def CONFIG_SECURITY_FILE_CAPABILITIES */
+
+kernel_cap_t cap_bset = CAP_INIT_BSET;    /* systemwide capability bound */
+EXPORT_SYMBOL(cap_bset);
+
+/* Global security state */
+
+unsigned securebits = SECUREBITS_DEFAULT; /* systemwide security settings */
+EXPORT_SYMBOL(securebits);
+
 int cap_netlink_send(struct sock *sk, struct sk_buff *skb)
 {
 	NETLINK_CB(skb).eff_cap = current->cap_effective;
@@ -73,14 +92,44 @@ int cap_capget (struct task_struct *target, kernel_cap_t *effective,
 	return 0;
 }
 
+#ifdef CONFIG_SECURITY_FILE_CAPABILITIES
+
+static inline int cap_block_setpcap(struct task_struct *target)
+{
+	/*
+	 * No support for remote process capability manipulation with
+	 * filesystem capability support.
+	 */
+	return (target != current);
+}
+
+static inline int cap_inh_is_capped(void)
+{
+	/*
+	 * return 1 if changes to the inheritable set are limited
+	 * to the old permitted set.
+	 */
+	return !cap_capable(current, CAP_SETPCAP);
+}
+
+#else /* ie., ndef CONFIG_SECURITY_FILE_CAPABILITIES */
+
+static inline int cap_block_setpcap(struct task_struct *t) { return 0; }
+static inline int cap_inh_is_capped(void) { return 1; }
+
+#endif /* def CONFIG_SECURITY_FILE_CAPABILITIES */
+
 int cap_capset_check (struct task_struct *target, kernel_cap_t *effective,
 		      kernel_cap_t *inheritable, kernel_cap_t *permitted)
 {
-	/* Derived from kernel/capability.c:sys_capset. */
-	/* verify restrictions on target's new Inheritable set */
-	if (!cap_issubset (*inheritable,
-			   cap_combine (target->cap_inheritable,
-					current->cap_permitted))) {
+	if (cap_block_setpcap(target)) {
+		return -EPERM;
+	}
+	if (cap_inh_is_capped()
+	    && !cap_issubset(*inheritable,
+			     cap_combine(target->cap_inheritable,
+					 current->cap_permitted))) {
+		/* incapable of using this inheritable set */
 		return -EPERM;
 	}
 
diff --git a/security/dummy.c b/security/dummy.c
index bc43d4c7383e..6d895ade73de 100644
--- a/security/dummy.c
+++ b/security/dummy.c
@@ -37,15 +37,13 @@ static int dummy_capget (struct task_struct *target, kernel_cap_t * effective,
 			 kernel_cap_t * inheritable, kernel_cap_t * permitted)
 {
 	*effective = *inheritable = *permitted = 0;
-	if (!issecure(SECURE_NOROOT)) {
-		if (target->euid == 0) {
-			*permitted |= (~0 & ~CAP_FS_MASK);
-			*effective |= (~0 & ~CAP_TO_MASK(CAP_SETPCAP) & ~CAP_FS_MASK);
-		}
-		if (target->fsuid == 0) {
-			*permitted |= CAP_FS_MASK;
-			*effective |= CAP_FS_MASK;
-		}
+	if (target->euid == 0) {
+		*permitted |= (~0 & ~CAP_FS_MASK);
+		*effective |= (~0 & ~CAP_TO_MASK(CAP_SETPCAP) & ~CAP_FS_MASK);
+	}
+	if (target->fsuid == 0) {
+		*permitted |= CAP_FS_MASK;
+		*effective |= CAP_FS_MASK;
 	}
 	return 0;
 }