diff --git a/tests/pos/i11681.scala b/tests/pos/i11681.scala
new file mode 100644
index 000000000000..587285911610
--- /dev/null
+++ b/tests/pos/i11681.scala
@@ -0,0 +1,28 @@
+// https://github.com/lampepfl/dotty/issues/11681
+
+import scala.collection.Factory
+
+final case class Gen[+A]() {
+  def take[C[X] <: Iterable[X], B](
+      n: Int
+  )(implicit w: A <:< C[B], f: Factory[B, C[B]]): Gen[C[B]] =
+    Gen()
+}
+
+object Usage {
+  def expected: Gen[List[Int]] =
+    Gen[List[Int]]().take(3)
+}
+
+object example:
+  type G[A]
+  given G[H[Int]] = ???
+
+  trait H[X]
+  object H {
+    given H[Int] = ???
+  }
+
+  def take[C[_]](using w: G[C[Int]], f: C[Int]) = ???
+
+  def test = take