diff --git a/include/clang/AST/DeclBase.h b/include/clang/AST/DeclBase.h
index 342eecb..ed609fe 100644
--- a/include/clang/AST/DeclBase.h
+++ b/include/clang/AST/DeclBase.h
@@ -565,6 +565,12 @@
     return const_cast<DeclContext*>(this)->getLexicalParent();
   }
 
+  DeclContext *getLookupParent();
+  
+  const DeclContext *getLookupParent() const {
+    return const_cast<DeclContext*>(this)->getLookupParent();
+  }
+  
   ASTContext &getParentASTContext() const {
     return cast<Decl>(this)->getASTContext();
   }
diff --git a/lib/AST/DeclBase.cpp b/lib/AST/DeclBase.cpp
index 34bc2b9..8d16139 100644
--- a/lib/AST/DeclBase.cpp
+++ b/lib/AST/DeclBase.cpp
@@ -420,6 +420,22 @@
     (*D++)->Destroy(C);
 }
 
+/// \brief Find the parent context of this context that will be
+/// used for unqualified name lookup.
+///
+/// Generally, the parent lookup context is the semantic context. However, for
+/// a friend function the parent lookup context is the lexical context, which
+/// is the class in which the friend is declared.
+DeclContext *DeclContext::getLookupParent() {
+  // FIXME: Find a better way to identify friends
+  if (isa<FunctionDecl>(this))
+    if (getParent()->getLookupContext()->isFileContext() &&
+        getLexicalParent()->getLookupContext()->isRecord())
+      return getLexicalParent();
+  
+  return getParent();
+}
+
 bool DeclContext::isDependentContext() const {
   if (isFileContext())
     return false;
diff --git a/lib/Sema/SemaLookup.cpp b/lib/Sema/SemaLookup.cpp
index 44c76a8..6767420 100644
--- a/lib/Sema/SemaLookup.cpp
+++ b/lib/Sema/SemaLookup.cpp
@@ -636,6 +636,15 @@
   return false;
 }
 
+// Find the next outer declaration context corresponding to this scope.
+static DeclContext *findOuterContext(Scope *S) {
+  for (S = S->getParent(); S; S = S->getParent())
+    if (S->getEntity())
+      return static_cast<DeclContext *>(S->getEntity())->getPrimaryContext();
+  
+  return 0;
+}
+
 std::pair<bool, Sema::LookupResult>
 Sema::CppLookupName(Scope *S, DeclarationName Name,
                     LookupNameKind NameKind, bool RedeclarationOnly) {
@@ -694,30 +703,23 @@
     }
     if (DeclContext *Ctx = static_cast<DeclContext*>(S->getEntity())) {
       LookupResult R;
-      // Perform member lookup into struct.
-      // FIXME: In some cases, we know that every name that could be found by
-      // this qualified name lookup will also be on the identifier chain. For
-      // example, inside a class without any base classes, we never need to
-      // perform qualified lookup because all of the members are on top of the
-      // identifier chain.
-      if (isa<RecordDecl>(Ctx)) {
+      
+      DeclContext *OuterCtx = findOuterContext(S);
+      for (; Ctx && Ctx->getPrimaryContext() != OuterCtx; 
+           Ctx = Ctx->getLookupParent()) {
+        if (Ctx->isFunctionOrMethod())
+          continue;
+        
+        // Perform qualified name lookup into this context.
+        // FIXME: In some cases, we know that every name that could be found by
+        // this qualified name lookup will also be on the identifier chain. For
+        // example, inside a class without any base classes, we never need to
+        // perform qualified lookup because all of the members are on top of the
+        // identifier chain.
         R = LookupQualifiedName(Ctx, Name, NameKind, RedeclarationOnly);
         if (R)
           return std::make_pair(true, R);
       }
-      if (Ctx->getParent() != Ctx->getLexicalParent()
-          || isa<CXXMethodDecl>(Ctx)) {
-        // It is out of line defined C++ method or struct, we continue
-        // doing name lookup in parent context. Once we will find namespace
-        // or translation-unit we save it for possible checking
-        // using-directives later.
-        for (OutOfLineCtx = Ctx; OutOfLineCtx && !OutOfLineCtx->isFileContext();
-             OutOfLineCtx = OutOfLineCtx->getParent()) {
-          R = LookupQualifiedName(OutOfLineCtx, Name, NameKind, RedeclarationOnly);
-          if (R)
-            return std::make_pair(true, R);
-        }
-      }
     }
   }
 
diff --git a/test/SemaCXX/member-name-lookup.cpp b/test/SemaCXX/member-name-lookup.cpp
index 9fcd922..e95641b 100644
--- a/test/SemaCXX/member-name-lookup.cpp
+++ b/test/SemaCXX/member-name-lookup.cpp
@@ -146,3 +146,13 @@
 struct UsesAmbigMemberType : HasMemberType1, HasMemberType2 {
   type t; // expected-error{{member 'type' found in multiple base classes of different types}}
 };
+
+struct X0 {
+  struct Inner {
+    static const int m;
+  };
+  
+  static const int n = 17;
+};
+
+const int X0::Inner::m = n;