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Allow locally-defined stdio MCP servers to run when the MCP registry policy fetch fails (no managed policy in force) #4512

Description

@dochollidayxx

Summary

When the MCP registry policy fetch fails, Copilot CLI fails closed and blocks all non-default MCP servers — including local stdio servers that the user defined themselves in their own ~/.copilot/mcp-config.json and launches as local child processes.

There is currently no way for a user to say "these are my own servers, run them regardless of registry reachability." I'd like a supported mechanism for that.

Environment

  • Copilot CLI 1.0.81-0
  • Windows (win32-x64)
  • Individual account, no managed/enterprise policy in effect

What happens

https://api.github.com/copilot/mcp_registry is currently returning 503:

HTTP/2.0 503 Service Unavailable
No server is currently available to service your request.

Which produces this in the CLI logs:

[MDM] No managed settings found at C:\Program Files\GitHubCopilot\managed-settings.json
[managedSettings] device MDM: no policy present on this device
[managedSettings] server policy: none for this account (404/empty) from https://github.com
[managedSettings] effective policy resolved: source=none, bypassDisabled=false, serverFetchFailed=false
[WARNING] Failed to fetch MCP registry policy: Failed to fetch MCP registry policy: 503 Service
          Unavailable. Non-default MCP servers will be blocked until the policy can be fetched.

Note the combination: the CLI explicitly resolves source=none — there is no device policy and no server policy for this account — and then still blocks every user-configured server because a separate registry endpoint is unavailable.

Result: 4 locally-defined stdio servers (meshy, blender, game-image-creator, playwright) silently disappear from the session. Only the built-in github-mcp-server remains. The session is unusable for the work it was opened to do, and the only remedy is to wait for a GitHub-side outage to clear.

Why this is the wrong default for local servers

The gate appears to be transport-blind. A stdio server is a local executable that the user already:

  1. wrote into their own config file,
  2. pointed at a binary on their own disk,
  3. runs as a child process under their own uid, with their own env vars.

That is strictly less privileged than the !-shell and arbitrary file-write tools the CLI already grants. Gating it on the reachability of a remote registry doesn't add a meaningful security property for a user with no managed policy — it just converts a GitHub availability blip into a local outage.

Remote/HTTP servers are a different story, and I have no objection to those staying gated.

Requested change

Any one of these would resolve it. Roughly in order of preference:

  1. Exempt locally-defined stdio servers from registry-policy gating when no managed policy is in force (source=none). The registry is a supply-chain control for servers the user didn't author; it shouldn't govern a local process the user already fully controls.
  2. A user-level trust list, e.g. "trustedMcpServers": ["blender", "playwright"] in settings.json, mirroring the existing disabledMcpServers key. Ignored/overridden whenever a real managed policy is present, so enterprise control is unaffected.
  3. Fail open on transient fetch failures specifically (5xx, timeouts, connection errors) when source=none, while continuing to fail closed on an actual policy that denies a server. A 503 is "we don't know", not "denied".

Current config surface

As far as I can tell from the shipped build, the only MCP-related keys accepted are mcpServers (in mcp-config.json) and disabledMcpServers (in settings.json). There's no positive-trust counterpart to disabledMcpServers, and the enforcement itself lives in the native runtime, so there's no user-side escape hatch at all today.

Related

The recurring theme across all of these is that a fetch failure for an absent or irrelevant policy takes down user-owned servers. This issue is the feature-side ask rather than another instance report.

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    area:enterpriseGitHub Enterprise (GHE/GHES) support, org policies, and enterprise settingsarea:mcpMCP server configuration, discovery, connectivity, OAuth, policy, and registry

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