diff --git a/tests/robot/DIRECTORY_TESTS/CREATE_DIRECTORY/E.4__COMPO_in_directory.robot b/tests/robot/DIRECTORY_TESTS/CREATE_DIRECTORY/E.4__COMPO_in_directory.robot
new file mode 100644
index 00000000..8a85f450
--- /dev/null
+++ b/tests/robot/DIRECTORY_TESTS/CREATE_DIRECTORY/E.4__COMPO_in_directory.robot
@@ -0,0 +1,61 @@
+*** Settings ***
+Documentation
+...     Covers: https://vitagroup-ag.atlassian.net/browse/CDR-1688
+...     Preconditions:
+...         1. Upload OPT
+...         2. Create EHR
+...         3. Commit Composition
+...
+...     Flow:
+...         - Invoke the create directory with 1 item "type": "COMPOSITION" (the one created in precondition)
+...
+...     Postconditions:
+...         - Delete EHR
+Metadata        TOP_TEST_SUITE    DIRECTORY
+
+Resource        ../../_resources/keywords/directory_keywords.robot
+Resource        ../../_resources/keywords/admin_keywords.robot
+Resource        ../../_resources/keywords/ehr_keywords.robot
+Resource        ../../_resources/keywords/composition_keywords.robot
+Suite Setup     Set Library Search Order For Tests
+
+
+*** Test Cases ***
+Test Add Composition To Folder
+    [Tags]      CDR-1688    not-ready   bug
+    [Setup]     Precondition
+    Get File And Replace Vars
+    ${exists}   Run Keyword And Return Status    Variable Should Exist    ${multitenancy_token}
+    IF      ${exists}
+        POST /ehr/ehr_id/directory    JSON      ${multitenancy_token}
+    ELSE
+        POST /ehr/ehr_id/directory    JSON
+    END
+    validate POST response - 201 created directory
+    [Teardown]      Run Keywords    (admin) delete ehr
+    ...             AND             (admin) delete all OPTs
+
+
+
+*** Keywords ***
+Precondition
+    Set Library Search Order For Tests
+    Upload OPT    nested/nested.opt
+    Extract Template Id From OPT File
+    Create Session      ${SUT}    ${BASEURL}    debug=2
+    ...     verify=True
+    create EHR
+    ##
+    commit composition   format=CANONICAL_JSON
+    ...                  composition=nested.en.v1__full_without_links.json
+    Set Suite Variable      ${composition_uid}   ${response.json()['uid']['value']}
+    @{split_compo_id}   Split String        ${composition_uid}      ::
+    ${composition_id}   Set Variable        ${split_compo_id}[0]
+    Set Suite Variable      ${compo_id}    ${composition_id}
+
+Get File And Replace Vars
+    ${json_str}             Get File    ${VALID DIR DATA SETS}/subfolder_in_directory_with_compo_item.json
+    ${json_str_replaced}    Replace Variables   ${json_str}
+    ${json_converted}       Evaluate    json.loads('''${json_str_replaced}''')    json
+                            Set Suite Variable      ${test_data}    ${json_converted}
+                            Log     ${test_data}
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diff --git a/tests/robot/_resources/test_data_sets/directory/subfolder_in_directory_with_compo_item.json b/tests/robot/_resources/test_data_sets/directory/subfolder_in_directory_with_compo_item.json
new file mode 100644
index 00000000..1146570f
--- /dev/null
+++ b/tests/robot/_resources/test_data_sets/directory/subfolder_in_directory_with_compo_item.json
@@ -0,0 +1,38 @@
+{
+  "_type": "FOLDER",
+  "name": {
+    "_type": "DV_TEXT",
+    "value": "hospital episodes"
+  },
+  "archetype_node_id": "openEHR-EHR-FOLDER.directory.v1",
+  "folders": [
+    {
+      "name": {
+        "_type": "DV_TEXT",
+        "value": "patient entered data"
+      },
+      "archetype_node_id": "at0001",
+      "folders": [
+        {
+          "name": {
+            "_type": "DV_TEXT",
+            "value": "diabetes monitoring"
+          },
+          "archetype_node_id": "at0001"
+        }
+      ],
+      "items": [{
+        "namespace": "local",
+        "type": "COMPOSITION",
+        "value": "${compo_id}"
+      }]
+    },
+    {
+      "name": {
+        "_type": "DV_TEXT",
+        "value": "caregiver entered data"
+      },
+      "archetype_node_id": "at0001"
+    }
+  ]
+}
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