diff --git a/src/Microsoft.Identity.Web.TokenAcquisition/TokenAcquisition.cs b/src/Microsoft.Identity.Web.TokenAcquisition/TokenAcquisition.cs
index 28b32b7fa..9b45a442f 100644
--- a/src/Microsoft.Identity.Web.TokenAcquisition/TokenAcquisition.cs
+++ b/src/Microsoft.Identity.Web.TokenAcquisition/TokenAcquisition.cs
@@ -820,6 +820,11 @@ private async Task<IConfidentialClientApplication> BuildConfidentialClientApplic
                     builder.WithRedirectUri(currentUri);
                 }
 
+                // ClientCapabilities are applied once during CCA construction
+                // (see UpdateConfidentialClientApplicationOptionsFromMergedOptions).
+                // We rely on that path. if it ever regresses the unit test
+                // (CrossCloudFicUnitTest) will fail.
+
                 string authority;
 
                 if (mergedOptions.PreserveAuthority && !string.IsNullOrEmpty(mergedOptions.Authority))
diff --git a/tests/E2E Tests/OidcIdPSignedAssertionProviderTests/OidCIdPSignedAssertionProviderExtensibilityTests.cs b/tests/E2E Tests/OidcIdPSignedAssertionProviderTests/OidCIdPSignedAssertionProviderExtensibilityTests.cs
index 6f587feea..75c3ff2c2 100644
--- a/tests/E2E Tests/OidcIdPSignedAssertionProviderTests/OidCIdPSignedAssertionProviderExtensibilityTests.cs	
+++ b/tests/E2E Tests/OidcIdPSignedAssertionProviderTests/OidCIdPSignedAssertionProviderExtensibilityTests.cs	
@@ -3,6 +3,8 @@
 
 using System;
 using System.Collections.Generic;
+using System.IdentityModel.Tokens.Jwt;
+using System.Linq;
 using System.Net.Http;
 using System.Text.Json;
 using System.Threading.Tasks;
@@ -60,6 +62,19 @@ public async Task CrossCloudFicIntegrationTest()
             // Assert
             Assert.NotNull(result);
             Assert.StartsWith("Bearer", result, StringComparison.Ordinal);
+
+            // Decode token & verify xms_cc
+            string jwt = result["Bearer ".Length..].Trim();
+
+            var handler = new JwtSecurityTokenHandler();
+            var token = handler.ReadJwtToken(jwt);
+
+            var xmsCcValues = token.Claims
+                                    .Where(c => c.Type == "xms_cc")
+                                    .Select(c => c.Value)
+                                    .ToArray();
+
+            Assert.Contains("cp1", xmsCcValues);
         }
 
         //[Fact(Skip ="Does not run if run with the E2E test")]
@@ -96,6 +111,7 @@ public async Task CrossCloudFicUnitTest()
                     options.Instance = "https://login.microsoftonline.com/";
                     options.TenantId = "t2";
                     options.ClientId = "c2";
+                    options.ClientCapabilities = ["cp1"];
                     options.ExtraQueryParameters = null;
                     options.ClientCredentials = [ new CredentialDescription() {
                     SourceType = CredentialSource.CustomSignedAssertion,
@@ -121,6 +137,28 @@ public async Task CrossCloudFicUnitTest()
                 Assert.Equal("c2", tokenRequestHttpHandler.ActualRequestPostData["client_id"]);
                 Assert.Equal("https://login.microsoftonline.com/t2/oauth2/v2.0/token", tokenRequestHttpHandler.ActualRequestMessage?.RequestUri?.AbsoluteUri);
 
+                // First request (credential exchange) – should have *no* "claims"
+                Assert.False(credentialRequestHttpHandler.ActualRequestPostData
+                                                             .ContainsKey("claims"));
+
+                // Second request (real token acquisition) – must carry "claims"
+                Assert.True(tokenRequestHttpHandler.ActualRequestPostData
+                                                   .ContainsKey("claims"));
+
+                // Extract and inspect the JSON payload
+                string claimsJson = tokenRequestHttpHandler.ActualRequestPostData["claims"];
+
+                using JsonDocument doc = JsonDocument.Parse(claimsJson);
+
+                string? cp = doc.RootElement
+                .GetProperty("access_token")
+                .GetProperty("xms_cc")
+                .GetProperty("values")[0]
+                .GetString();
+
+                // Ensure that the client capabilities are passed in the claims
+                Assert.Equal("cp1", cp);
+
                 string? accessTokenFromRequest1;
                 using (JsonDocument document = JsonDocument.Parse(credentialRequestHttpHandler.ResponseString))
                 {
diff --git a/tests/E2E Tests/OidcIdPSignedAssertionProviderTests/appsettings.json b/tests/E2E Tests/OidcIdPSignedAssertionProviderTests/appsettings.json
index 07aeb14f0..2d7bd7b7d 100644
--- a/tests/E2E Tests/OidcIdPSignedAssertionProviderTests/appsettings.json	
+++ b/tests/E2E Tests/OidcIdPSignedAssertionProviderTests/appsettings.json	
@@ -3,8 +3,9 @@
     "AzureAd": {
         "Instance": "https://login.microsoftonline.com/",
         "TenantId": "msidlab4.onmicrosoft.com",
-        "ExtraQueryParameters": { "dc": "ESTS-PUB-WEULR1-AZ1-FD000-TEST1" },        
+        "ExtraQueryParameters": { "dc": "ESTS-PUB-WEULR1-AZ1-FD000-TEST1" },
         "ClientId": "5e71875b-ae52-4a3c-8b82-f6fdc8e1dbe1", // this app is configured to trust credentials (tokens) from f6b698c0-140c-448f-8155-4aa9bf77ceba
+        "ClientCapabilities": [ "cp1" ],
         "ClientCredentials": [
             {
                 "SourceType": "CustomSignedAssertion",