diff --git a/compiler/backend/src/org/jetbrains/jet/codegen/ImplementationBodyCodegen.java b/compiler/backend/src/org/jetbrains/jet/codegen/ImplementationBodyCodegen.java
index a8660f9b5ac..ca60d90a3ba 100644
--- a/compiler/backend/src/org/jetbrains/jet/codegen/ImplementationBodyCodegen.java
+++ b/compiler/backend/src/org/jetbrains/jet/codegen/ImplementationBodyCodegen.java
@@ -187,7 +187,7 @@ public class ImplementationBodyCodegen extends ClassBodyCodegen {
 
     private void writeInnerClasses() {
         for (ClassDescriptor innerClass : getInnerClassesAndObjects(descriptor)) {
-            writeInnerClass(innerClass, false /* TODO */);
+            writeInnerClass(innerClass);
         }
 
         ClassDescriptor classObjectDescriptor = descriptor.getClassObjectDescriptor();
@@ -199,7 +199,7 @@ public class ImplementationBodyCodegen extends ClassBodyCodegen {
         }
     }
 
-    private void writeInnerClass(ClassDescriptor innerClass, boolean isStatic) {
+    private void writeInnerClass(ClassDescriptor innerClass) {
         // TODO: proper access
         int innerClassAccess = getVisibilityAccessFlag(innerClass);
         if (innerClass.getModality() == Modality.FINAL) {
@@ -216,7 +216,7 @@ public class ImplementationBodyCodegen extends ClassBodyCodegen {
             innerClassAccess |= ACC_ENUM;
         }
 
-        if (isStatic) {
+        if (!innerClass.isInner()) {
             innerClassAccess |= ACC_STATIC;
         }
 
diff --git a/compiler/backend/src/org/jetbrains/jet/codegen/binding/CodegenBinding.java b/compiler/backend/src/org/jetbrains/jet/codegen/binding/CodegenBinding.java
index b7423f3895a..7baf8b9ffba 100644
--- a/compiler/backend/src/org/jetbrains/jet/codegen/binding/CodegenBinding.java
+++ b/compiler/backend/src/org/jetbrains/jet/codegen/binding/CodegenBinding.java
@@ -134,17 +134,25 @@ public class CodegenBinding {
     }
 
     public static boolean canHaveOuter(BindingContext bindingContext, @NotNull ClassDescriptor classDescriptor) {
-        final ClassKind kind = classDescriptor.getKind();
         if (isSingleton(bindingContext, classDescriptor)) {
             return false;
         }
 
-        if (kind == ClassKind.ENUM_CLASS) {
+        ClassDescriptor enclosing = enclosingClassDescriptor(bindingContext, classDescriptor);
+        if (enclosing == null) {
             return false;
         }
 
-        final ClassDescriptor enclosing = enclosingClassDescriptor(bindingContext, classDescriptor);
-        return enclosing != null && !isSingleton(bindingContext, enclosing);
+        ClassKind kind = classDescriptor.getKind();
+        if (kind == ClassKind.CLASS) {
+            return classDescriptor.isInner() || !(classDescriptor.getContainingDeclaration() instanceof ClassDescriptor);
+        }
+        else if (kind == ClassKind.OBJECT) {
+            return !isSingleton(bindingContext, enclosing);
+        }
+        else {
+            return false;
+        }
     }
 
     public static boolean isSingleton(BindingContext bindingContext, @NotNull ClassDescriptor classDescriptor) {
diff --git a/compiler/testData/writeFlags/innerClass/visibility/internal.kt b/compiler/testData/writeFlags/innerClass/visibility/internal.kt
index e5e7e408df6..3eeaa2e4e77 100644
--- a/compiler/testData/writeFlags/innerClass/visibility/internal.kt
+++ b/compiler/testData/writeFlags/innerClass/visibility/internal.kt
@@ -1,5 +1,5 @@
 class Foo {
-  class MyClass() {
+  inner class MyClass() {
   }
 }
 
diff --git a/compiler/testData/writeFlags/innerClass/visibility/private.kt b/compiler/testData/writeFlags/innerClass/visibility/private.kt
index 3d691f34c2c..292b313f2a9 100644
--- a/compiler/testData/writeFlags/innerClass/visibility/private.kt
+++ b/compiler/testData/writeFlags/innerClass/visibility/private.kt
@@ -1,5 +1,5 @@
 class Foo {
-  private class MyClass() {
+  private inner class MyClass() {
   }
 }
 
diff --git a/compiler/testData/writeFlags/innerClass/visibility/public.kt b/compiler/testData/writeFlags/innerClass/visibility/public.kt
index bd65e7413a8..2ef3e89581c 100644
--- a/compiler/testData/writeFlags/innerClass/visibility/public.kt
+++ b/compiler/testData/writeFlags/innerClass/visibility/public.kt
@@ -1,5 +1,5 @@
 class Foo {
-  public class MyClass() {
+  public inner class MyClass() {
   }
 }
 
diff --git a/compiler/testData/writeFlags/property/visibility/internal.kt b/compiler/testData/writeFlags/property/visibility/internal.kt
index cd5cb865054..c17dc7a0163 100644
--- a/compiler/testData/writeFlags/property/visibility/internal.kt
+++ b/compiler/testData/writeFlags/property/visibility/internal.kt
@@ -1,5 +1,5 @@
 class Foo {
-  class MyClass() {
+  inner class MyClass() {
   }
 }
 
diff --git a/compiler/testData/writeFlags/property/visibility/private.kt b/compiler/testData/writeFlags/property/visibility/private.kt
index cd2b7140606..b6d56a703e5 100644
--- a/compiler/testData/writeFlags/property/visibility/private.kt
+++ b/compiler/testData/writeFlags/property/visibility/private.kt
@@ -1,5 +1,5 @@
 class Foo {
-  private class MyClass() {
+  private inner class MyClass() {
   }
 }
 
diff --git a/compiler/testData/writeFlags/property/visibility/public.kt b/compiler/testData/writeFlags/property/visibility/public.kt
index a3b8e1b914f..63f97f4fe13 100644
--- a/compiler/testData/writeFlags/property/visibility/public.kt
+++ b/compiler/testData/writeFlags/property/visibility/public.kt
@@ -1,5 +1,5 @@
 class Foo {
-  public class MyClass() {
+  public inner class MyClass() {
   }
 }