Index: app/models/issue.rb
IDEA additional info:
Subsystem: com.intellij.openapi.diff.impl.patch.CharsetEP
<+>UTF-8
===================================================================
--- app/models/issue.rb	(revision 7558df09e92995965e436603045474c0e3952007)
+++ app/models/issue.rb	(revision fca4c59cad3a71a1eef2653f433bf6d5f01ec56a)
@@ -1552,7 +1552,24 @@
   # Returns a scope of projects that user can assign the issue to
   def allowed_target_projects(user=User.current, context=nil)
     if new_record? && context.is_a?(Project) && !copy?
-      current_project = context.self_and_descendants
+      if parent_issue_id.present? # returns available projects for subtasks
+        case Setting.cross_project_subtasks
+        when 'system'
+          current_project = Project.visible(user)
+        when 'tree'
+          current_project = Project.visible(user).where("(#{Project.table_name}.lft >= :lft AND #{Project.table_name}.rgt <= :rgt)",
+                                                        :lft => context.root.lft, :rgt => context.root.rgt)
+        when 'hierarchy'
+          current_project = Project.visible(user).where("(#{Project.table_name}.lft >= :lft AND #{Project.table_name}.rgt <= :rgt) OR (#{Project.table_name}.lft < :lft AND #{Project.table_name}.rgt > :rgt)",
+                                                        :lft => context.lft, :rgt => context.rgt)
+        when 'descendants'
+          current_project = context.self_and_descendants
+        else
+          current_project = Project.where(:id => context.id)
+        end
+      else
+        current_project = context.self_and_descendants
+      end
     elsif new_record?
       current_project = nil
     else
@@ -1569,7 +1586,7 @@
     if current_project.is_a?(Project)
       condition = ["(#{condition}) OR #{Project.table_name}.id = ?", current_project.id]
     elsif current_project
-      condition = ["(#{condition}) AND #{Project.table_name}.id IN (?)", current_project.map(&:id)]
+      condition = ["(#{condition}) AND #{Project.table_name}.id IN (?)", current_project.ids]
     end
     Project.where(condition).having_trackers
   end
Index: test/functional/issues_controller_test.rb
IDEA additional info:
Subsystem: com.intellij.openapi.diff.impl.patch.CharsetEP
<+>UTF-8
===================================================================
--- test/functional/issues_controller_test.rb	(revision 7558df09e92995965e436603045474c0e3952007)
+++ test/functional/issues_controller_test.rb	(revision fca4c59cad3a71a1eef2653f433bf6d5f01ec56a)
@@ -2822,6 +2822,99 @@
     assert_select 'select[name="issue[project_id]"]', 0
   end
 
+  def test_get_new_should_respect_cross_project_subtasks_setting
+    # # disabled
+    with_settings :cross_project_subtasks  => "" do
+      @request.session[:user_id] = 2
+      get :new, :params => {
+          :project_id => 1,
+          :tracker_id => 1,
+          :issue => {
+              :parent_issue_id => 7
+          }
+      }
+      assert_response :success
+      assert_select 'select[name=?]', 'issue[project_id]', 0
+    end
+
+    # all projects
+    with_settings :cross_project_subtasks  => "system" do
+      @request.session[:user_id] = 2
+      get :new, :params => {
+          :project_id => 1,
+          :tracker_id => 1,
+          :issue => {
+              :parent_issue_id => 7
+          }
+      }
+      assert_response :success
+      assert_select 'select[name="issue[project_id]"]' do
+        assert_select 'option', 4
+        assert_select 'option[selected=selected]', :text => 'eCookbook'
+        assert_select 'option[value=?]', '5', :text => '  » Private child of eCookbook'
+        assert_select 'option[value=?]', '3', :text => '  » eCookbook Subproject 1'
+        assert_select 'option[value=?]', '2', :text => 'OnlineStore'
+      end
+    end
+
+    # project tree
+    with_settings :cross_project_subtasks  => "tree" do
+      @request.session[:user_id] = 2
+      get :new, :params => {
+          :project_id => 1,
+          :tracker_id => 1,
+          :issue => {
+              :parent_issue_id => 7
+          }
+      }
+      assert_response :success
+      assert_select 'select[name="issue[project_id]"]' do
+        assert_select 'option', 3
+        assert_select 'option[selected=selected]', :text => 'eCookbook'
+        assert_select 'option[value=?]', '5', :text => '  » Private child of eCookbook'
+        assert_select 'option[value=?]', '3', :text => '  » eCookbook Subproject 1'
+      end
+    end
+
+    # project hierarchy
+    with_settings :cross_project_subtasks  => "hierarchy" do
+      @request.session[:user_id] = 2
+      get :new, :params => {
+          :project_id => 1,
+          :tracker_id => 1,
+          :issue => {
+              :parent_issue_id => 7
+          }
+      }
+      assert_response :success
+      assert_select 'select[name="issue[project_id]"]' do
+        assert_select 'option', 3
+        assert_select 'option[selected=selected]', :text => 'eCookbook'
+        assert_select 'option[value=?]', '5', :text => '  » Private child of eCookbook'
+        assert_select 'option[value=?]', '3', :text => '  » eCookbook Subproject 1'
+      end
+    end
+
+    # subprojects
+    with_settings :cross_project_subtasks  => "descendants" do
+      @request.session[:user_id] = 2
+      get :new, :params => {
+          :project_id => 1,
+          :tracker_id => 1,
+          :issue => {
+              :parent_issue_id => 7
+          }
+      }
+      assert_response :success
+      assert_select 'select[name="issue[project_id]"]' do
+        assert_select 'option', 3
+        assert_select 'option[selected=selected]', :text => 'eCookbook'
+        assert_select 'option[value=?]', '5', :text => '  » Private child of eCookbook'
+        assert_select 'option[value=?]', '3', :text => '  » eCookbook Subproject 1'
+      end
+    end
+  end
+
   def test_get_new_with_minimal_permissions
     Role.find(1).update_attribute :permissions, [:add_issues]
     WorkflowTransition.where(:role_id => 1).delete_all