diff --git a/doc/notes/path-processing b/doc/notes/path-processing
new file mode 100644
index 00000000..8560ee0a
--- /dev/null
+++ b/doc/notes/path-processing
@@ -0,0 +1,65 @@
+Path processing
+---------------
+Need rules that will work for both the existing scenario (B) and the new
+scenario (A):
+
+
+    _
+   / \
+  / _ \
+ / ___ \
+/_/   \_\
+---------
+
+root    = ../
+package = suppliers/colony             <--- /suppliers/colony
+import  = ../map/return/colony         <--- /map/return/colony
+
+mapimport = ../../suppliers/colony/gl  <-- /suppliers/colony/gl
+
+
+      this is the root
+     /                \
+    v                  v
+1) <..>/map/return/ | <..>/../suppliers/colony/gl
+     = ../suppliers/colony/gl
+            ^^^^^^^^^^^^^^^^
+            \              /
+              package name
+
+2) strip root||(package base) from package import
+     = ../map/return | <../suppliers/>colony/gl
+     = colony/gl
+       ^^^^^^^^^
+                ` The relative path from package
+
+
+
+ ____
+| __ )
+|  _ \
+| |_) |
+|____/
+-------
+
+what about normal includes?
+
+
+root    = ../
+package = suppliers/colony   <--- /suppliers/colony
+import  = ../common/foo      <--- /common/foo
+
+subimport = bar/baz          <--- /common/foo/bar/baz
+
+
+       one has root, other does not
+      /
+     v
+1) <..>/common/ | bar/baz
+     = ../common/bar/baz
+
+2) strip root||(package base) from package import
+     = ../common/bar/baz
+       ^^^^^^^^^^^^^^^^^
+                        ` no such prefix,
+                          so this is the relative path
diff --git a/src/current/include/preproc/path.xsl b/src/current/include/preproc/path.xsl
index 14d0ceee..6d611478 100644
--- a/src/current/include/preproc/path.xsl
+++ b/src/current/include/preproc/path.xsl
@@ -22,6 +22,7 @@
 -->
 <stylesheet version="2.0"
   xmlns="http://www.w3.org/1999/XSL/Transform"
+  xmlns:xs="http://www.w3.org/2001/XMLSchema"
   xmlns:preproc="http://www.lovullo.com/rater/preproc">
 
 
@@ -59,6 +60,15 @@
 </template>
 
 
+<function name="preproc:get-path" as="xs:string">
+  <param name="path" />
+
+  <call-template name="preproc:get-path">
+    <with-param name="path" select="$path" />
+  </call-template>
+</function>
+
+
 <!-- FIXME: duplicate code with above -->
 <template name="preproc:get-basename">
   <param name="path" />
@@ -94,6 +104,7 @@
 </template>
 
 
+<!-- TODO: rename to preproc:resolve-path -->
 <template name="preproc:resolv-path">
   <param name="path" />
 
@@ -112,6 +123,26 @@
 </template>
 
 
+<function name="preproc:resolv-path" as="xs:string">
+  <param name="path" />
+
+  <variable name="result" as="xs:string*">
+    <call-template name="preproc:resolv-path">
+      <with-param name="path" select="$path" />
+    </call-template>
+  </variable>
+
+  <sequence select="string-join( $result, '' )" />
+</function>
+
+<!-- alias to the above -->
+<function name="preproc:resolve-path" as="xs:string">
+  <param name="path" />
+
+  <sequence select="preproc:resolv-path( $path )" />
+</function>
+
+
 <!-- XXX: warning, this won't like 'foo../' -->
 <template name="preproc:resolv-rel-path">
   <param name="path" />
@@ -244,4 +275,44 @@
   </choose>
 </template>
 
+
+<!--
+  Resolve relative package imports
+
+  This situation arises when a source package (src) imports another
+  package (src-import) that has a reference to an external symbol
+  (sub-import).
+
+  See /doc/notes/path-processing for an illustration.
+-->
+<function name="preproc:resolve-relative-import" as="xs:string">
+  <param name="src-root"   as="xs:string" />
+  <param name="src-name"   as="xs:string" />
+  <param name="src-import" as="xs:string" />
+  <param name="sub-import" as="xs:string" />
+
+  <variable name="src-prefix" as="xs:string"
+            select="concat( $src-root, '/', $src-name )" />
+
+  <!-- Step 1: resolve relative paths from sub-import -->
+  <variable name="src-import-dir" as="xs:string"
+            select="preproc:get-path( $src-import )" />
+  <variable name="sub-concat" as="xs:string"
+            select="if ( $src-import-dir ) then
+                        preproc:resolve-path(
+                          concat( $src-import-dir, '/', $sub-import ) )
+                      else
+                        $sub-import" />
+
+  <!-- Step 2: remove package name prefix, if present -->
+  <variable name="src-name-base" as="xs:string"
+            select="preproc:get-path( $src-name )" />
+  <variable name="src-prefix" as="xs:string"
+            select="concat( $src-root, $src-name-base, '/' )" />
+  <variable name="suffix" as="xs:string"
+            select="substring-after( $sub-concat, $src-prefix )" />
+
+  <sequence select="if ( $suffix ) then $suffix else $sub-concat" />
+</function>
+
 </stylesheet>
diff --git a/src/current/include/preproc/symtable.xsl b/src/current/include/preproc/symtable.xsl
index 2cf726cd..e9a7c619 100644
--- a/src/current/include/preproc/symtable.xsl
+++ b/src/current/include/preproc/symtable.xsl
@@ -521,12 +521,18 @@
   <xsl:param name="no-extclass" select="@no-extclass" />
   <xsl:param name="keep-classes" select="@keep-classes" />
 
-  <xsl:variable name="path" select="concat( $package, '.xmlo' )" />
+  <xsl:variable name="path" as="xs:string"
+                select="concat( $package, '.xmlo' )" />
   <xsl:variable name="syms"
-    select="document( $path, $orig-root )/lv:*/preproc:symtable" />
+                select="document( $path, $orig-root )/lv:*/preproc:symtable" />
 
   <xsl:variable name="import-path" select="$package" />
 
+  <xsl:variable name="src-root" as="xs:string"
+                select="ancestor::lv:package/@__rootpath" />
+  <xsl:variable name="src-name" as="xs:string"
+                select="ancestor::lv:package/@name" />
+
   <!-- if they're including a program package, do they realize what they're
        doing!? -->
   <!-- FIXME: @allow-nonpkg is no longer accurate terminology; change to
@@ -542,14 +548,6 @@
     </xsl:message>
   </xsl:if>
 
-  <!-- determine our path from our name -->
-  <xsl:variable name="our-path">
-    <xsl:call-template name="preproc:get-path">
-      <xsl:with-param name="path"
-        select="ancestor::lv:package/@name" />
-    </xsl:call-template>
-  </xsl:variable>
-
   <!-- to keep everything consistent and to simplify package equality
        assertions, resolve relative paths -->
   <xsl:variable name="import-default-path" select="$import-path" />
@@ -626,23 +624,11 @@
                itself) onto the existing relative path and resolving relative
                paths -->
           <xsl:otherwise>
-            <xsl:call-template name="preproc:resolv-path">
-              <xsl:with-param name="path">
-                <!-- get the path of the import, sans package name -->
-                <xsl:variable name="path">
-                  <xsl:call-template name="preproc:get-path">
-                    <xsl:with-param name="path" select="$import-path" />
-                  </xsl:call-template>
-                </xsl:variable>
-
-                <!-- concatenate it with the existing relative path -->
-                <xsl:if test="not( $path = '' )">
-                  <xsl:value-of select="concat( $path, '/' )" />
-                </xsl:if>
-
-                <xsl:value-of select="@src" />
-              </xsl:with-param>
-            </xsl:call-template>
+            <xsl:sequence select="preproc:resolve-relative-import(
+                                    $src-root,
+                                    $src-name,
+                                    $import-path,
+                                    @src )" />
           </xsl:otherwise>
         </xsl:choose>
       </xsl:attribute>