diff --git a/compiler/testData/loadJava/compiledJava/mutability/ReadOnlyExtendsWildcard.java b/compiler/testData/loadJava/compiledJava/mutability/ReadOnlyExtendsWildcard.java
new file mode 100644
index 00000000000..5d5824f48de
--- /dev/null
+++ b/compiler/testData/loadJava/compiledJava/mutability/ReadOnlyExtendsWildcard.java
@@ -0,0 +1,10 @@
+package test;
+
+import org.jetbrains.annotations.*;
+
+import java.util.*;
+
+public interface ReadOnlyExtendsWildcard {
+    void bar(); // Non-SAM
+    void foo(@ReadOnly List<? extends CharSequence> x, @NotNull Comparable<? super String> y);
+}
diff --git a/compiler/testData/loadJava/compiledJava/mutability/ReadOnlyExtendsWildcard.txt b/compiler/testData/loadJava/compiledJava/mutability/ReadOnlyExtendsWildcard.txt
new file mode 100644
index 00000000000..7db4a7b3627
--- /dev/null
+++ b/compiler/testData/loadJava/compiledJava/mutability/ReadOnlyExtendsWildcard.txt
@@ -0,0 +1,6 @@
+package test
+
+public interface ReadOnlyExtendsWildcard {
+    public abstract fun bar(): kotlin.Unit
+    public abstract fun foo(/*0*/ org.jetbrains.annotations.ReadOnly() p0: kotlin.List<kotlin.CharSequence!>!, /*1*/ org.jetbrains.annotations.NotNull() p1: kotlin.Comparable<kotlin.String!>): kotlin.Unit
+}
diff --git a/compiler/tests/org/jetbrains/kotlin/jvm/compiler/LoadJavaTestGenerated.java b/compiler/tests/org/jetbrains/kotlin/jvm/compiler/LoadJavaTestGenerated.java
index b8cf8d2c37a..5b280378d8f 100644
--- a/compiler/tests/org/jetbrains/kotlin/jvm/compiler/LoadJavaTestGenerated.java
+++ b/compiler/tests/org/jetbrains/kotlin/jvm/compiler/LoadJavaTestGenerated.java
@@ -1382,6 +1382,12 @@ public class LoadJavaTestGenerated extends AbstractLoadJavaTest {
                 String fileName = JetTestUtils.navigationMetadata("compiler/testData/loadJava/compiledJava/mutability/LoadIterableWithPropagation.java");
                 doTestCompiledJava(fileName);
             }
+
+            @TestMetadata("ReadOnlyExtendsWildcard.java")
+            public void testReadOnlyExtendsWildcard() throws Exception {
+                String fileName = JetTestUtils.navigationMetadata("compiler/testData/loadJava/compiledJava/mutability/ReadOnlyExtendsWildcard.java");
+                doTestCompiledJava(fileName);
+            }
         }
 
         @TestMetadata("compiler/testData/loadJava/compiledJava/notNull")
diff --git a/compiler/tests/org/jetbrains/kotlin/jvm/runtime/JvmRuntimeDescriptorLoaderTestGenerated.java b/compiler/tests/org/jetbrains/kotlin/jvm/runtime/JvmRuntimeDescriptorLoaderTestGenerated.java
index 225d0edc8f4..20590cd13c7 100644
--- a/compiler/tests/org/jetbrains/kotlin/jvm/runtime/JvmRuntimeDescriptorLoaderTestGenerated.java
+++ b/compiler/tests/org/jetbrains/kotlin/jvm/runtime/JvmRuntimeDescriptorLoaderTestGenerated.java
@@ -3977,6 +3977,12 @@ public class JvmRuntimeDescriptorLoaderTestGenerated extends AbstractJvmRuntimeD
                 String fileName = JetTestUtils.navigationMetadata("compiler/testData/loadJava/compiledJava/mutability/LoadIterableWithPropagation.java");
                 doTest(fileName);
             }
+
+            @TestMetadata("ReadOnlyExtendsWildcard.java")
+            public void testReadOnlyExtendsWildcard() throws Exception {
+                String fileName = JetTestUtils.navigationMetadata("compiler/testData/loadJava/compiledJava/mutability/ReadOnlyExtendsWildcard.java");
+                doTest(fileName);
+            }
         }
 
         @TestMetadata("compiler/testData/loadJava/compiledJava/notNull")
diff --git a/core/descriptor.loader.java/src/org/jetbrains/kotlin/load/java/lazy/types/LazyJavaTypeResolver.kt b/core/descriptor.loader.java/src/org/jetbrains/kotlin/load/java/lazy/types/LazyJavaTypeResolver.kt
index 3e1ac5ef070..e9a196d11a0 100644
--- a/core/descriptor.loader.java/src/org/jetbrains/kotlin/load/java/lazy/types/LazyJavaTypeResolver.kt
+++ b/core/descriptor.loader.java/src/org/jetbrains/kotlin/load/java/lazy/types/LazyJavaTypeResolver.kt
@@ -41,6 +41,7 @@ import org.jetbrains.kotlin.types.Variance.INVARIANT
 import org.jetbrains.kotlin.types.Variance.IN_VARIANCE
 import org.jetbrains.kotlin.types.Variance.OUT_VARIANCE
 import org.jetbrains.kotlin.types.checker.JetTypeChecker
+import org.jetbrains.kotlin.types.typeUtil.createProjection
 import org.jetbrains.kotlin.types.typeUtil.replaceAnnotations
 import org.jetbrains.kotlin.utils.sure
 import java.util.HashSet
@@ -247,11 +248,11 @@ class LazyJavaTypeResolver(
                     if (bound == null)
                         makeStarProjection(typeParameter, attr)
                     else {
-                        var projectionKind = if (javaType.isExtends()) OUT_VARIANCE else IN_VARIANCE
-                        if (projectionKind == typeParameter.getVariance()) {
-                            projectionKind = Variance.INVARIANT
-                        }
-                        TypeProjectionImpl(projectionKind, transformJavaType(bound, UPPER_BOUND.toAttributes()))
+                        createProjection(
+                                type = transformJavaType(bound, UPPER_BOUND.toAttributes()),
+                                projectionKind = if (javaType.isExtends()) OUT_VARIANCE else IN_VARIANCE,
+                                typeParameterDescriptor = typeParameter
+                        )
                     }
                 }
                 else -> TypeProjectionImpl(INVARIANT, transformJavaType(javaType, attr))
diff --git a/core/descriptor.loader.java/src/org/jetbrains/kotlin/load/java/typeEnhacement/typeEnhancement.kt b/core/descriptor.loader.java/src/org/jetbrains/kotlin/load/java/typeEnhacement/typeEnhancement.kt
index 4bf5e469691..1d66d433c50 100644
--- a/core/descriptor.loader.java/src/org/jetbrains/kotlin/load/java/typeEnhacement/typeEnhancement.kt
+++ b/core/descriptor.loader.java/src/org/jetbrains/kotlin/load/java/typeEnhacement/typeEnhancement.kt
@@ -29,6 +29,7 @@ import org.jetbrains.kotlin.load.java.typeEnhacement.NullabilityQualifier.NULLAB
 import org.jetbrains.kotlin.name.FqName
 import org.jetbrains.kotlin.platform.JavaToKotlinClassMap
 import org.jetbrains.kotlin.types.*
+import org.jetbrains.kotlin.types.typeUtil.createProjection
 
 // The index in the lambda is the position of the type component:
 // Example: for `A<B, C<D, E>>`, indices go as follows: `0 - A<...>, 1 - B, 2 - C<D, E>, 3 - D, 4 - E`,
@@ -74,6 +75,8 @@ private fun JetType.enhanceInflexible(qualifiers: (Int) -> JavaTypeQualifiers, i
     val effectiveQualifiers = qualifiers(index)
     val (enhancedClassifier, enhancedMutabilityAnnotations) = originalClass.enhanceMutability(effectiveQualifiers, position)
 
+    val typeConstructor = enhancedClassifier.typeConstructor
+
     var globalArgIndex = index + 1
     val enhancedArguments = getArguments().mapIndexed {
         localArgIndex, arg ->
@@ -84,10 +87,7 @@ private fun JetType.enhanceInflexible(qualifiers: (Int) -> JavaTypeQualifiers, i
         else {
             val (enhancedType, subtreeSize) = arg.getType().enhancePossiblyFlexible(qualifiers, globalArgIndex)
             globalArgIndex += subtreeSize
-            TypeProjectionImpl(
-                    arg.getProjectionKind(),
-                    enhancedType
-            )
+            createProjection(enhancedType, arg.projectionKind, typeParameterDescriptor = typeConstructor.parameters[localArgIndex])
         }
     }
 
@@ -99,12 +99,12 @@ private fun JetType.enhanceInflexible(qualifiers: (Int) -> JavaTypeQualifiers, i
     ).filterNotNull().compositeAnnotationsOrSingle()
 
     val (newSubstitution, substitutedEnhancedArgs) = computeNewSubstitutionAndArguments(
-        enhancedClassifier.typeConstructor.parameters, enhancedArguments
+        typeConstructor.parameters, enhancedArguments
     )
 
     val enhancedType = JetTypeImpl(
             newAnnotations,
-            enhancedClassifier.getTypeConstructor(),
+            typeConstructor,
             enhancedNullability,
             substitutedEnhancedArgs,
             newSubstitution,
diff --git a/core/descriptors/src/org/jetbrains/kotlin/types/TypeUtils.kt b/core/descriptors/src/org/jetbrains/kotlin/types/TypeUtils.kt
index 5cee83e56a4..16dd7c14493 100644
--- a/core/descriptors/src/org/jetbrains/kotlin/types/TypeUtils.kt
+++ b/core/descriptors/src/org/jetbrains/kotlin/types/TypeUtils.kt
@@ -136,3 +136,5 @@ public fun List<JetType>.defaultProjections(): List<TypeProjection> = map { Type
 
 public fun JetType.isDefaultBound(): Boolean = KotlinBuiltIns.isDefaultBound(getSupertypeRepresentative())
 
+public fun createProjection(type: JetType, projectionKind: Variance, typeParameterDescriptor: TypeParameterDescriptor?): TypeProjection =
+        TypeProjectionImpl(if (typeParameterDescriptor?.variance == projectionKind) Variance.INVARIANT else projectionKind, type)