diff --git a/compiler/src/dotty/tools/dotc/typer/Checking.scala b/compiler/src/dotty/tools/dotc/typer/Checking.scala
index ca2dd9b3c1dd..9f6793760017 100644
--- a/compiler/src/dotty/tools/dotc/typer/Checking.scala
+++ b/compiler/src/dotty/tools/dotc/typer/Checking.scala
@@ -483,16 +483,17 @@ object Checking {
           }
           tp1
         case tp: ClassInfo =>
+          def transformedParent(tp: Type): Type = tp match {
+            case ref: TypeRef => ref
+            case ref: AppliedType => ref
+            case AnnotatedType(parent, annot) =>
+              AnnotatedType(transformedParent(parent), annot)
+            case _ => defn.ObjectType // can happen if class files are missing
+          }
           tp.derivedClassInfo(
             prefix = apply(tp.prefix),
             classParents =
-              tp.parents.map { p =>
-                apply(p).stripAnnots match {
-                  case ref: TypeRef => ref
-                  case ref: AppliedType => ref
-                  case _ => defn.ObjectType // can happen if class files are missing
-                }
-              }
+              tp.parents.map(p => transformedParent(apply(p)))
             )
         case _ =>
           mapOver(tp)
diff --git a/compiler/src/dotty/tools/dotc/typer/Namer.scala b/compiler/src/dotty/tools/dotc/typer/Namer.scala
index f8d83964e82b..ed32410d2f74 100644
--- a/compiler/src/dotty/tools/dotc/typer/Namer.scala
+++ b/compiler/src/dotty/tools/dotc/typer/Namer.scala
@@ -888,7 +888,7 @@ class Namer { typer: Typer =>
        * (4) If the class is sealed, it is defined in the same compilation unit as the current class
        */
       def checkedParentType(parent: untpd.Tree): Type = {
-        val ptype = parentType(parent)(ctx.superCallContext).dealias
+        val ptype = parentType(parent)(ctx.superCallContext).dealiasKeepAnnots
         if (cls.isRefinementClass) ptype
         else {
           val pt = checkClassType(ptype, parent.pos,
diff --git a/compiler/src/dotty/tools/dotc/typer/Typer.scala b/compiler/src/dotty/tools/dotc/typer/Typer.scala
index 240999864503..ee076403eb35 100644
--- a/compiler/src/dotty/tools/dotc/typer/Typer.scala
+++ b/compiler/src/dotty/tools/dotc/typer/Typer.scala
@@ -1572,11 +1572,11 @@ class Typer extends Namer
       checkNoDoubleDeclaration(cls)
       val impl1 = cpy.Template(impl)(constr1, parents1, self1, body1)
         .withType(dummy.termRef)
-      checkVariance(impl1)
       if (!cls.is(AbstractOrTrait) && !ctx.isAfterTyper)
         checkRealizableBounds(cls, cdef.namePos)
       if (cls.is(Case) && cls.derivesFrom(defn.EnumClass)) checkEnum(cdef, cls)
       val cdef1 = assignType(cpy.TypeDef(cdef)(name, impl1), cls)
+      checkVariance(cdef1)
       if (ctx.phase.isTyper && cdef1.tpe.derivesFrom(defn.DynamicClass) && !ctx.dynamicsEnabled) {
         val isRequired = parents1.exists(_.tpe.isRef(defn.DynamicClass))
         ctx.featureWarning(nme.dynamics.toString, "extension of type scala.Dynamic", isScala2Feature = true,
diff --git a/compiler/src/dotty/tools/dotc/typer/VarianceChecker.scala b/compiler/src/dotty/tools/dotc/typer/VarianceChecker.scala
index 0bef02453441..fa626f8b6825 100644
--- a/compiler/src/dotty/tools/dotc/typer/VarianceChecker.scala
+++ b/compiler/src/dotty/tools/dotc/typer/VarianceChecker.scala
@@ -95,8 +95,8 @@ class VarianceChecker()(implicit ctx: Context) {
             this(status, tp.resultType) // params will be checked in their TypeDef or ValDef nodes.
           case AnnotatedType(_, annot) if annot.symbol == defn.UncheckedVarianceAnnot =>
             status
-          //case tp: ClassInfo =>
-          //  ???  not clear what to do here yet. presumably, it's all checked at local typedefs
+          case tp: ClassInfo =>
+            foldOver(status, tp.classParents)
           case _ =>
             foldOver(status, tp)
         }
@@ -142,14 +142,16 @@ class VarianceChecker()(implicit ctx: Context) {
           ctx.debuglog(s"Skipping variance check of ${sym.showDcl}")
         case tree: TypeDef =>
           checkVariance(sym, tree.pos)
+          tree.rhs match {
+            case rhs: Template => traverseChildren(rhs)
+            case _ =>
+          }
         case tree: ValDef =>
           checkVariance(sym, tree.pos)
         case DefDef(_, tparams, vparamss, _, _) =>
           checkVariance(sym, tree.pos)
           tparams foreach traverse
           vparamss foreach (_ foreach traverse)
-        case Template(_, _, _, body) =>
-          traverseChildren(tree)
         case _ =>
       }
     }
diff --git a/tests/neg/i2973.scala b/tests/neg/i2973.scala
new file mode 100644
index 000000000000..8edd4c66fd70
--- /dev/null
+++ b/tests/neg/i2973.scala
@@ -0,0 +1,68 @@
+import annotation.unchecked.uncheckedVariance
+
+class InvClass[U]
+trait InvTrait[U]
+class ContraClass[-T]
+trait ContraTrait[-T]
+class CoClass[+T]
+trait CoTrait[+T]
+
+class Contra[-T] extends InvClass[T] // error: contravariant type T occurs in invariant position
+class Co[+T] extends InvClass[T] // error
+
+class ContraInvT[-T] extends InvTrait[T] // error
+class ContraCoT[-T] extends CoTrait[T] // error
+class CoInvT[+T] extends InvTrait[T] // error
+class CoContraT[+T] extends ContraTrait[T] // error
+class CoInvCoT[+T] extends InvTrait[T] with CoTrait[T] // error
+class CoContraCoT[+T] extends ContraTrait[T] with CoTrait[T] // error
+
+class ContraContraInv[-T] extends ContraClass[T] with InvTrait[T] // error
+class ContraCoInv[-T] extends CoClass[T] with InvTrait[T] // error
+class CoCoInv[+T] extends CoClass[T] with InvTrait[T] // error
+
+class ContraInvContra[-T] extends InvClass[T] with ContraTrait[T] // error
+class CoInvContra[+T] extends InvClass[T] with ContraTrait[T] // error
+class ContraInvCo[-T] extends InvClass[T] with CoTrait[T] // error
+class CoInvCo[+T] extends InvClass[T] with CoTrait[T] // error
+
+// @uncheckedVariance but in the wrong place
+class ContraContraInv2[-T] extends ContraClass[T] @uncheckedVariance with InvTrait[T] // error
+class ContraCoInv2[-T] extends CoClass[T] @uncheckedVariance with InvTrait[T] // error
+
+trait Prefix1 {
+  trait Prefix2 {
+    class InvClass[U]
+    trait InvTrait[U]
+    class ContraClass[-T]
+    trait ContraTrait[-T]
+    class CoClass[+T]
+    trait CoTrait[+T]
+  }
+}
+
+trait Prefix3 {
+  def f(v1: Prefix1)(v2: v1.Prefix2): Unit = {
+    class Contra[-T] extends InvClass[T] // error: contravariant type T occurs in invariant position
+    class Co[+T] extends InvClass[T] // error
+
+    class ContraInvT[-T] extends InvTrait[T] // error
+    class ContraCoT[-T] extends CoTrait[T] // error
+    class CoInvT[+T] extends InvTrait[T] // error
+    class CoContraT[+T] extends ContraTrait[T] // error
+    class CoInvCoT[+T] extends InvTrait[T] with CoTrait[T] // error
+    class CoContraCoT[+T] extends ContraTrait[T] with CoTrait[T] // error
+
+    class ContraContraInv[-T] extends ContraClass[T] with InvTrait[T] // error
+    class ContraCoInv[-T] extends CoClass[T] with InvTrait[T] // error
+    class CoCoInv[+T] extends CoClass[T] with InvTrait[T] // error
+
+    class ContraInvContra[-T] extends InvClass[T] with ContraTrait[T] // error
+    class CoInvContra[+T] extends InvClass[T] with ContraTrait[T] // error
+    class ContraInvCo[-T] extends InvClass[T] with CoTrait[T] // error
+    class CoInvCo[+T] extends InvClass[T] with CoTrait[T] // error
+
+    class ContraContraInv2[-T] extends ContraClass[T] @uncheckedVariance with InvTrait[T] // error
+    class ContraCoInv2[-T] extends CoClass[T] @uncheckedVariance with InvTrait[T] // error
+  }
+}
diff --git a/tests/pos/i2973.scala b/tests/pos/i2973.scala
new file mode 100644
index 000000000000..f89f82070653
--- /dev/null
+++ b/tests/pos/i2973.scala
@@ -0,0 +1,71 @@
+import annotation.unchecked.uncheckedVariance
+
+class InvClass[U]
+trait InvTrait[U]
+class ContraClass[-T]
+trait ContraTrait[-T]
+class CoClass[+T]
+trait CoTrait[+T]
+
+trait Prefix1 {
+  trait Prefix2 {
+    class InvClass[U]
+    trait InvTrait[U]
+    class ContraClass[-T]
+    trait ContraTrait[-T]
+    class CoClass[+T]
+    trait CoTrait[+T]
+  }
+}
+
+class Contra[-T] extends InvClass[T] @uncheckedVariance
+class Co[+T] extends InvClass[T] @uncheckedVariance
+
+class ContraInvT[-T] extends InvTrait[T] @uncheckedVariance
+class ContraCoT[-T] extends CoTrait[T] @uncheckedVariance
+class CoInvT[+T] extends InvTrait[T] @uncheckedVariance
+class CoContraT[+T] extends ContraTrait[T] @uncheckedVariance
+class CoInvCoT[+T] extends InvTrait[T] @uncheckedVariance with CoTrait[T]
+class CoContraCoT[+T] extends ContraTrait[T] @uncheckedVariance with CoTrait[T]
+
+class ContraContraInv[-T] extends ContraClass[T] with InvTrait[T] @uncheckedVariance
+class ContraCoInv[-T] extends CoClass[T] @uncheckedVariance with InvTrait[T] @uncheckedVariance
+class CoCoInv[+T] extends CoClass[T] with InvTrait[T] @uncheckedVariance
+
+class ContraInvContra[-T] extends InvClass[T] @uncheckedVariance with ContraTrait[T]
+class CoInvContra[+T] extends InvClass[T] @uncheckedVariance with ContraTrait[T] @uncheckedVariance
+class ContraInvCo[-T] extends InvClass[T] @uncheckedVariance with CoTrait[T] @uncheckedVariance
+class CoInvCo[+T] extends InvClass[T] @uncheckedVariance with CoTrait[T]
+
+// @uncheckedVariance but also in the wrong place
+class CoInvCoT2[+T] extends InvTrait[T] @uncheckedVariance with CoTrait[T] @uncheckedVariance
+class ContraContraInv2[-T] extends ContraClass[T] @uncheckedVariance with InvTrait[T] @uncheckedVariance
+class ContraCoInv2[-T] extends CoClass[T] @uncheckedVariance with InvTrait[T] @uncheckedVariance
+
+trait Prefix3 {
+  def f(v1: Prefix1)(v2: v1.Prefix2): Unit = {
+    class Contra[-T] extends InvClass[T] @uncheckedVariance
+    class Co[+T] extends InvClass[T] @uncheckedVariance
+
+    class ContraInvT[-T] extends InvTrait[T] @uncheckedVariance
+    class ContraCoT[-T] extends CoTrait[T] @uncheckedVariance
+    class CoInvT[+T] extends InvTrait[T] @uncheckedVariance
+    class CoContraT[+T] extends ContraTrait[T] @uncheckedVariance
+    class CoInvCoT[+T] extends InvTrait[T] @uncheckedVariance with CoTrait[T]
+    class CoContraCoT[+T] extends ContraTrait[T] @uncheckedVariance with CoTrait[T]
+
+    class ContraContraInv[-T] extends ContraClass[T] with InvTrait[T] @uncheckedVariance
+    class ContraCoInv[-T] extends CoClass[T] @uncheckedVariance with InvTrait[T] @uncheckedVariance
+    class CoCoInv[+T] extends CoClass[T] with InvTrait[T] @uncheckedVariance
+
+    class ContraInvContra[-T] extends InvClass[T] @uncheckedVariance with ContraTrait[T]
+    class CoInvContra[+T] extends InvClass[T] @uncheckedVariance with ContraTrait[T] @uncheckedVariance
+    class ContraInvCo[-T] extends InvClass[T] @uncheckedVariance with CoTrait[T] @uncheckedVariance
+    class CoInvCo[+T] extends InvClass[T] @uncheckedVariance with CoTrait[T]
+
+    // @uncheckedVariance but also in the wrong place
+    class CoInvCoT2[+T] extends InvTrait[T] @uncheckedVariance with CoTrait[T] @uncheckedVariance
+    class ContraContraInv2[-T] extends ContraClass[T] @uncheckedVariance with InvTrait[T] @uncheckedVariance
+    class ContraCoInv2[-T] extends CoClass[T] @uncheckedVariance with InvTrait[T] @uncheckedVariance
+  }
+}