Python: bump package versions for 1.8.0 release (#6351)

- Released cohort (core, openai, foundry, root): 1.7.0 -> 1.8.0
- agent-framework-github-copilot: promote to RC (1.0.0rc1)
- agent-framework-orchestrations: rc2 -> rc3 (bug fix)
- Beta/alpha packages with changes: a2a, anthropic, azurefunctions, bedrock,
  foundry-hosting, mistral bumped to new date stamp (260604)
- Inter-package dependency bounds updated for changed packages
- CHANGELOG.md and PACKAGE_STATUS.md updated

Co-authored-by: Copilot <223556219+Copilot@users.noreply.github.com>

.github/scripts/pr_limit_moderation.js

@@ -8,6 +8,7 @@ function getPullRequest(context) {
 
   return {
     author: pullRequest.user.login,
+    authorType: pullRequest.user.type,
     labels: pullRequest.labels?.map((label) => label.name).filter(Boolean) ?? [],
     number: pullRequest.number,
   };
@@ -49,6 +50,10 @@ function hasLabel(labels, labelName) {
   return labels.some((label) => label.toLowerCase() === labelName.toLowerCase());
 }
 
+function isDependabotAuthor({ author, authorType }) {
+  return authorType === 'Bot' && author.toLowerCase() === 'dependabot[bot]';
+}
+
 function buildLimitMessage({ author, exemptLabelName, maxOpenPrs, openPrCount }) {
   return [
     `Thank you for your contribution, @${author}.`,
@@ -83,7 +88,17 @@ async function getOpenPrCount({ github, owner, repo, author, pullRequestNumber }
 
 async function enforcePrLimit({ github, context, core, exemptLabelName, maxOpenPrs, labelName }) {
   const { owner, repo } = context.repo;
-  const { author, labels, number } = getPullRequest(context);
+  const { author, authorType, labels, number } = getPullRequest(context);
+
+  if (isDependabotAuthor({ author, authorType })) {
+    core.info(`Author ${author} is Dependabot; skipping open PR limit enforcement.`);
+    return {
+      author,
+      closed: false,
+      dependabotExempt: true,
+      openPrCount: null,
+    };
+  }
 
   if (hasLabel(labels, exemptLabelName)) {
     core.info(`PR #${number} has the ${exemptLabelName} label; skipping open PR limit enforcement.`);

.github/tests/test_pr_limit_moderation.js

@@ -16,7 +16,7 @@ const { enforcePrLimit } = require('../scripts/pr_limit_moderation.js');
 // Helpers
 // ---------------------------------------------------------------------------
 
-function createContext({ author = 'community-user', labels = [], number = 123 } = {}) {
+function createContext({ author = 'community-user', authorType = 'User', labels = [], number = 123 } = {}) {
   return {
     repo: {
       owner: 'microsoft',
@@ -28,6 +28,7 @@ function createContext({ author = 'community-user', labels = [], number = 123 }
         labels: labels.map((name) => ({ name })),
         user: {
           login: author,
+          type: authorType,
         },
       },
     },
@@ -296,6 +297,30 @@ describe('PR limit enforcement', () => {
     assert.deepEqual(github.calls, []);
   });
 
+  it('does not close Dependabot PRs', async () => {
+    const github = createGithub({
+      itemNumbers: [123, ...Array.from({ length: 25 }, (_, index) => index + 1)],
+      pullRequests: createPullRequestPage({
+        author: 'dependabot[bot]',
+        numbers: [123, ...Array.from({ length: 25 }, (_, index) => index + 1)],
+      }),
+    });
+
+    const result = await enforcePrLimit({
+      github,
+      context: createContext({ author: 'dependabot[bot]', authorType: 'Bot' }),
+      core: createCore(),
+      exemptLabelName: 'pr-limit-exempt',
+      maxOpenPrs: 10,
+      labelName: 'too-many-prs',
+    });
+
+    assert.equal(result.closed, false);
+    assert.equal(result.dependabotExempt, true);
+    assert.equal(result.openPrCount, null);
+    assert.deepEqual(github.calls, []);
+  });
+
   it('counts the current PR when the author has more than one page of open PRs', async () => {
     const github = createGithub({
       itemNumbers: [123, ...Array.from({ length: 100 }, (_, index) => index + 1)],

.github/workflows/python-integration-tests.yml

@@ -474,6 +474,45 @@ jobs:
           path: ./python/pytest.xml
           if-no-files-found: ignore
 
+  # GitHub Copilot integration tests
+  python-tests-github-copilot:
+    name: Python Integration Tests - GitHub Copilot
+    runs-on: ubuntu-latest
+    environment: integration
+    timeout-minutes: 60
+    env:
+      COPILOT_GITHUB_TOKEN: ${{ secrets.COPILOT_GITHUB_TOKEN }}
+      GITHUB_COPILOT_TIMEOUT: "120"
+    defaults:
+      run:
+        working-directory: python
+    steps:
+      - uses: actions/checkout@de0fac2e4500dabe0009e67214ff5f5447ce83dd # v6
+        with:
+          ref: ${{ inputs.checkout-ref }}
+          persist-credentials: false
+      - name: Set up python and install the project
+        id: python-setup
+        uses: ./.github/actions/python-setup
+        with:
+          python-version: ${{ env.UV_PYTHON }}
+          os: ${{ runner.os }}
+      - name: Test with pytest (GitHub Copilot integration)
+        run: >
+          uv run pytest --import-mode=importlib
+          packages/github_copilot/tests
+          -m integration
+          --timeout=120 --session-timeout=900 --timeout_method thread
+          --retries 2 --retry-delay 5
+          --junitxml=pytest.xml
+      - name: Upload test results
+        if: always()
+        uses: actions/upload-artifact@043fb46d1a93c77aae656e7c1c64a875d1fc6a0a # v7
+        with:
+          name: test-results-github-copilot
+          path: ./python/pytest.xml
+          if-no-files-found: ignore
+
   # Integration test trend report (aggregates per-job JUnit XML results)
   python-integration-test-report:
     name: Integration Test Report
@@ -490,6 +529,7 @@ jobs:
         python-tests-foundry,
         python-tests-foundry-hosting,
         python-tests-cosmos,
+        python-tests-github-copilot,
       ]
     runs-on: ubuntu-latest
     defaults:
@@ -553,7 +593,8 @@ jobs:
         python-tests-functions,
         python-tests-foundry,
         python-tests-foundry-hosting,
-        python-tests-cosmos
+        python-tests-cosmos,
+        python-tests-github-copilot
       ]
     steps:
       - name: Fail workflow if tests failed

.github/workflows/python-merge-tests.yml

@@ -40,6 +40,7 @@ jobs:
       foundryChanged: ${{ steps.filter.outputs.foundry }}
       foundryHostingChanged: ${{ steps.filter.outputs.foundry_hosting }}
       cosmosChanged: ${{ steps.filter.outputs.cosmos }}
+      githubCopilotChanged: ${{ steps.filter.outputs.github_copilot }}
     steps:
       - uses: actions/checkout@de0fac2e4500dabe0009e67214ff5f5447ce83dd # v6
       - uses: dorny/paths-filter@d1c1ffe0248fe513906c8e24db8ea791d46f8590 # v3
@@ -85,6 +86,8 @@ jobs:
               - 'python/packages/foundry_hosting/**'
             cosmos:
               - 'python/packages/azure-cosmos/**'
+            github_copilot:
+              - 'python/packages/github_copilot/**'
       # run only if 'python' files were changed
       - name: python tests
         if: steps.filter.outputs.python == 'true'
@@ -658,6 +661,58 @@ jobs:
           path: ./python/pytest.xml
           if-no-files-found: ignore
 
+  # GitHub Copilot integration tests
+  python-tests-github-copilot:
+    name: Python Tests - GitHub Copilot Integration
+    needs: paths-filter
+    if: >
+      github.event_name != 'pull_request' &&
+      needs.paths-filter.outputs.pythonChanges == 'true' &&
+      (github.event_name != 'merge_group' ||
+       needs.paths-filter.outputs.githubCopilotChanged == 'true' ||
+       needs.paths-filter.outputs.coreChanged == 'true')
+    runs-on: ubuntu-latest
+    environment: integration
+    timeout-minutes: 60
+    env:
+      COPILOT_GITHUB_TOKEN: ${{ secrets.COPILOT_GITHUB_TOKEN }}
+      GITHUB_COPILOT_TIMEOUT: "120"
+    defaults:
+      run:
+        working-directory: python
+    steps:
+      - uses: actions/checkout@de0fac2e4500dabe0009e67214ff5f5447ce83dd # v6
+      - name: Set up python and install the project
+        id: python-setup
+        uses: ./.github/actions/python-setup
+        with:
+          python-version: ${{ env.UV_PYTHON }}
+          os: ${{ runner.os }}
+      - name: Test with pytest (GitHub Copilot integration)
+        run: >
+          uv run pytest --import-mode=importlib
+          packages/github_copilot/tests
+          -m integration
+          --timeout=120 --session-timeout=900 --timeout_method thread
+          --retries 2 --retry-delay 5
+          --junitxml=pytest.xml
+      - name: Surface failing tests
+        if: always()
+        uses: pmeier/pytest-results-action@20b595761ba9bf89e115e875f8bc863f913bc8ad # v0.7.2
+        with:
+          path: ./python/pytest.xml
+          summary: true
+          display-options: fEX
+          fail-on-empty: false
+          title: GitHub Copilot integration test results
+      - name: Upload test results
+        if: always()
+        uses: actions/upload-artifact@043fb46d1a93c77aae656e7c1c64a875d1fc6a0a # v7
+        with:
+          name: test-results-github-copilot
+          path: ./python/pytest.xml
+          if-no-files-found: ignore
+
   # Integration test trend report (aggregates per-job JUnit XML results)
   python-integration-test-report:
     name: Integration Test Report
@@ -674,6 +729,7 @@ jobs:
         python-tests-foundry,
         python-tests-foundry-hosting,
         python-tests-cosmos,
+        python-tests-github-copilot,
       ]
     runs-on: ubuntu-latest
     defaults:
@@ -735,6 +791,7 @@ jobs:
         python-tests-foundry,
         python-tests-foundry-hosting,
         python-tests-cosmos,
+        python-tests-github-copilot,
       ]
     steps:
       - name: Fail workflow if tests failed

dotnet/Directory.Packages.props

@@ -109,7 +109,7 @@
     <PackageVersion Include="A2A" Version="1.0.0-preview2" />
     <PackageVersion Include="A2A.AspNetCore" Version="1.0.0-preview2" />
     <!-- MCP -->
-    <PackageVersion Include="ModelContextProtocol" Version="1.1.0" />
+    <PackageVersion Include="ModelContextProtocol" Version="1.2.0" />
     <!-- Hyperlight -->
     <PackageVersion Include="Hyperlight.HyperlightSandbox.Api" Version="0.4.0" />
     <PackageVersion Include="Hyperlight.HyperlightSandbox.Guest.Python" Version="0.4.0" />

dotnet/samples/03-workflows/Observability/WorkflowAsAnAgent/WorkflowHelper.cs

@@ -50,12 +50,16 @@ internal static partial class WorkflowHelper
     /// <summary>
     /// Executor that starts the concurrent processing by sending messages to the agents.
     /// </summary>
-    private sealed partial class ConcurrentStartExecutor() : Executor("ConcurrentStartExecutor")
+    [SendsMessage(typeof(List<ChatMessage>))]
+    [SendsMessage(typeof(TurnToken))]
+    private sealed partial class ConcurrentStartExecutor()
+        : Executor("ConcurrentStartExecutor", declareCrossRunShareable: true), IResettableExecutor
     {
         [MessageHandler]
-        internal ValueTask RouteMessages(List<ChatMessage> messages, IWorkflowContext context, CancellationToken cancellationToken)
+        internal ValueTask RouteMessages(IEnumerable<ChatMessage> messages, IWorkflowContext context, CancellationToken cancellationToken)
         {
-            return context.SendMessageAsync(messages, cancellationToken: cancellationToken);
+            List<ChatMessage> payload = messages as List<ChatMessage> ?? messages.ToList();
+            return context.SendMessageAsync(payload, cancellationToken: cancellationToken);
         }
 
         [MessageHandler]
@@ -63,13 +67,16 @@ internal static partial class WorkflowHelper
         {
             return context.SendMessageAsync(token, cancellationToken: cancellationToken);
         }
+
+        public ValueTask ResetAsync() => default;
     }
 
     /// <summary>
     /// Executor that aggregates the results from the concurrent agents.
     /// </summary>
-    [YieldsOutput(typeof(List<ChatMessage>))]
-    private sealed partial class ConcurrentAggregationExecutor() : Executor<List<ChatMessage>>("ConcurrentAggregationExecutor")
+    [YieldsOutput(typeof(string))]
+    private sealed partial class ConcurrentAggregationExecutor() :
+        Executor<List<ChatMessage>>("ConcurrentAggregationExecutor"), IResettableExecutor
     {
         private readonly List<ChatMessage> _messages = [];
 
@@ -90,5 +97,11 @@ internal static partial class WorkflowHelper
                 await context.YieldOutputAsync(formattedMessages, cancellationToken);
             }
         }
+
+        public ValueTask ResetAsync()
+        {
+            this._messages.Clear();
+            return default;
+        }
     }
 }

dotnet/samples/04-hosting/FoundryHostedAgents/responses/Hosted-McpTools/HostedMcpTools.csproj

@@ -13,7 +13,7 @@
   <ItemGroup>
     <PackageReference Include="Azure.AI.Projects" />
     <PackageReference Include="Azure.Identity" />
-    <PackageReference Include="ModelContextProtocol" VersionOverride="1.2.0" />
+    <PackageReference Include="ModelContextProtocol" />
     <PackageReference Include="DotNetEnv" />
   </ItemGroup>
 

dotnet/src/Microsoft.Agents.AI/Skills/File/AgentFileSkill.cs

@@ -49,14 +49,13 @@ public sealed class AgentFileSkill : AgentSkill
     /// <inheritdoc/>
     /// <remarks>
     /// Returns the raw SKILL.md content. When the skill has scripts, a
-    /// <c>&lt;scripts&gt;&lt;script name="..."&gt;&lt;parameters_schema&gt;...&lt;/parameters_schema&gt;&lt;/script&gt;&lt;/scripts&gt;</c>
-    /// block is appended with a per-script entry describing the expected argument format.
+    /// <c>&lt;script_schemas&gt;</c> block is appended describing the argument format.
     /// The result is cached after the first access.
     /// </remarks>
     public override ValueTask<string> GetContentAsync(CancellationToken cancellationToken = default)
     {
         var content = this._content ??= this._scripts is { Count: > 0 }
-            ? this._originalContent + AgentInlineSkillContentBuilder.BuildScriptsBlock(this._scripts)
+            ? this._originalContent + AgentInlineSkillContentBuilder.BuildScriptSchemasBlock(this._scripts)
             : this._originalContent;
         return new(content);
     }

dotnet/src/Microsoft.Agents.AI/Skills/Programmatic/AgentClassSkill.cs

@@ -114,7 +114,6 @@ public abstract class AgentClassSkill<
             this.Frontmatter.Name,
             this.Frontmatter.Description,
             this.Instructions,
-            this.Resources,
             this.Scripts));
     }
 
@@ -147,11 +146,17 @@ public abstract class AgentClassSkill<
     /// Gets the resources associated with this skill, or <see langword="null"/> if none.
     /// </summary>
     /// <remarks>
+    /// <para>
     /// The default implementation returns resources discovered via reflection by scanning
     /// <typeparamref name="TSelf"/> for members annotated with <see cref="AgentSkillResourceAttribute"/>.
     /// This discovery is compatible with Native AOT because <typeparamref name="TSelf"/> is annotated with
     /// <see cref="DynamicallyAccessedMembersAttribute"/>. The result is cached after the first access.
     /// Override this property in derived classes to provide skill-specific resources.
+    /// </para>
+    /// <para>
+    /// Resources are not automatically included in the skill body.
+    /// To enable discovery, reference resources by name in the skill's instructions or in other resources.
+    /// </para>
     /// </remarks>
     public virtual IReadOnlyList<AgentSkillResource>? Resources => this._resources.Value;
 
@@ -159,11 +164,17 @@ public abstract class AgentClassSkill<
     /// Gets the scripts associated with this skill, or <see langword="null"/> if none.
     /// </summary>
     /// <remarks>
+    /// <para>
     /// The default implementation returns scripts discovered via reflection by scanning
     /// <typeparamref name="TSelf"/> for methods annotated with <see cref="AgentSkillScriptAttribute"/>.
     /// This discovery is compatible with Native AOT because <typeparamref name="TSelf"/> is annotated with
     /// <see cref="DynamicallyAccessedMembersAttribute"/>. The result is cached after the first access.
     /// Override this property in derived classes to provide skill-specific scripts.
+    /// </para>
+    /// <para>
+    /// Only script parameter schemas are included in the skill body (as a <c>&lt;script_schemas&gt;</c> block).
+    /// To enable discovery, reference scripts by name in the skill's instructions or in a resource.
+    /// </para>
     /// </remarks>
     public virtual IReadOnlyList<AgentSkillScript>? Scripts => this._scripts.Value;
 
@@ -184,6 +195,10 @@ public abstract class AgentClassSkill<
     /// <summary>
     /// Creates a skill resource backed by a static value.
     /// </summary>
+    /// <remarks>
+    /// Resources are not automatically included in the skill body.
+    /// To enable discovery, reference the resource by name in the skill's instructions or in another resource.
+    /// </remarks>
     /// <param name="name">The resource name.</param>
     /// <param name="value">The static resource value.</param>
     /// <param name="description">An optional description of the resource.</param>
@@ -194,6 +209,10 @@ public abstract class AgentClassSkill<
     /// <summary>
     /// Creates a skill resource backed by a delegate that produces a dynamic value.
     /// </summary>
+    /// <remarks>
+    /// Resources are not automatically included in the skill body.
+    /// To enable discovery, reference the resource by name in the skill's instructions or in another resource.
+    /// </remarks>
     /// <param name="name">The resource name.</param>
     /// <param name="method">A method that produces the resource value when requested.</param>
     /// <param name="description">An optional description of the resource.</param>
@@ -208,6 +227,10 @@ public abstract class AgentClassSkill<
     /// <summary>
     /// Creates a skill script backed by a delegate.
     /// </summary>
+    /// <remarks>
+    /// Only the script's parameter schema is included in the skill body (as a <c>&lt;script_schemas&gt;</c> block).
+    /// To enable discovery, reference the script by name in the skill's instructions or in a resource.
+    /// </remarks>
     /// <param name="name">The script name.</param>
     /// <param name="method">A method to execute when the script is invoked.</param>
     /// <param name="description">An optional description of the script.</param>

dotnet/src/Microsoft.Agents.AI/Skills/Programmatic/AgentInlineSkill.cs

@@ -95,7 +95,7 @@ public sealed class AgentInlineSkill : AgentSkill
     /// <inheritdoc/>
     public override ValueTask<string> GetContentAsync(CancellationToken cancellationToken = default)
     {
-        return new(this._cachedContent ??= AgentInlineSkillContentBuilder.Build(this.Frontmatter.Name, this.Frontmatter.Description, this._instructions, this._resources, this._scripts));
+        return new(this._cachedContent ??= AgentInlineSkillContentBuilder.Build(this.Frontmatter.Name, this.Frontmatter.Description, this._instructions, this._scripts));
     }
 
     /// <inheritdoc/>
@@ -115,6 +115,10 @@ public sealed class AgentInlineSkill : AgentSkill
     /// <summary>
     /// Registers a static resource with this skill.
     /// </summary>
+    /// <remarks>
+    /// Resources are not automatically included in the skill body.
+    /// To enable discovery, reference the resource by name in the skill's instructions or in another resource.
+    /// </remarks>
     /// <param name="name">The resource name.</param>
     /// <param name="value">The static resource value.</param>
     /// <param name="description">An optional description of the resource.</param>
@@ -129,6 +133,10 @@ public sealed class AgentInlineSkill : AgentSkill
     /// Registers a dynamic resource with this skill, backed by a C# delegate.
     /// The delegate's parameters and return type are automatically marshaled via <c>AIFunctionFactory</c>.
     /// </summary>
+    /// <remarks>
+    /// Resources are not automatically included in the skill body.
+    /// To enable discovery, reference the resource by name in the skill's instructions or in another resource.
+    /// </remarks>
     /// <param name="name">The resource name.</param>
     /// <param name="method">A method that produces the resource value when requested.</param>
     /// <param name="description">An optional description of the resource.</param>
@@ -147,6 +155,10 @@ public sealed class AgentInlineSkill : AgentSkill
     /// Registers a script with this skill, backed by a C# delegate.
     /// The delegate's parameters and return type are automatically marshaled via <c>AIFunctionFactory</c>.
     /// </summary>
+    /// <remarks>
+    /// Only the script's parameter schema is included in the skill body (as a <c>&lt;script_schemas&gt;</c> block).
+    /// To enable discovery, reference the script by name in the skill's instructions or in a resource.
+    /// </remarks>
     /// <param name="name">The script name.</param>
     /// <param name="method">A method to execute when the script is invoked.</param>
     /// <param name="description">An optional description of the script.</param>

dotnet/src/Microsoft.Agents.AI/Skills/Programmatic/AgentInlineSkillContentBuilder.cs

@@ -12,19 +12,17 @@ namespace Microsoft.Agents.AI;
 internal static class AgentInlineSkillContentBuilder
 {
     /// <summary>
-    /// Builds the complete skill content containing name, description, instructions, resources, and scripts.
+    /// Builds the complete skill content containing name, description, instructions, and script parameter schemas.
     /// </summary>
     /// <param name="name">The skill name.</param>
     /// <param name="description">The skill description.</param>
     /// <param name="instructions">The raw instructions text.</param>
-    /// <param name="resources">Optional resources associated with the skill.</param>
     /// <param name="scripts">Optional scripts associated with the skill.</param>
     /// <returns>An XML-structured content string.</returns>
     public static string Build(
         string name,
         string description,
         string instructions,
-        IReadOnlyList<AgentSkillResource>? resources,
         IReadOnlyList<AgentSkillScript>? scripts)
     {
         _ = Throw.IfNullOrWhitespace(name);
@@ -39,41 +37,24 @@ internal static class AgentInlineSkillContentBuilder
         .Append(EscapeXmlString(instructions))
         .Append("\n</instructions>");
 
-        if (resources is { Count: > 0 })
-        {
-            sb.Append("\n\n<resources>\n");
-            foreach (var resource in resources)
-            {
-                if (resource.Description is not null)
-                {
-                    sb.Append($"  <resource name=\"{EscapeXmlString(resource.Name)}\" description=\"{EscapeXmlString(resource.Description)}\"/>\n");
-                }
-                else
-                {
-                    sb.Append($"  <resource name=\"{EscapeXmlString(resource.Name)}\"/>\n");
-                }
-            }
-
-            sb.Append("</resources>");
-        }
-
         if (scripts is { Count: > 0 })
         {
             sb.Append('\n');
-            sb.Append(BuildScriptsBlock(scripts));
+            sb.Append(BuildScriptSchemasBlock(scripts));
         }
 
         return sb.ToString();
     }
 
     /// <summary>
-    /// Builds a <c>&lt;scripts&gt;...&lt;/scripts&gt;</c> XML block for the given scripts.
-    /// Each script is emitted as a <c>&lt;script name="..."&gt;</c> element with optional
-    /// <c>description</c> attribute and <c>&lt;parameters_schema&gt;</c> child element.
+    /// Builds a <c>&lt;script_schemas&gt;...&lt;/script_schemas&gt;</c> XML block for the given scripts.
+    /// Each script is emitted as a <c>&lt;schema script="..."&gt;</c> element containing only
+    /// the parameter schema. This block serves as a reference for the model to know how to
+    /// format arguments when calling scripts, not as a discovery mechanism.
     /// </summary>
     /// <param name="scripts">The scripts to include in the block.</param>
-    /// <returns>An XML string starting with <c>\n&lt;scripts&gt;</c>, or an empty string if the list is empty.</returns>
-    public static string BuildScriptsBlock(IReadOnlyList<AgentSkillScript> scripts)
+    /// <returns>An XML string starting with <c>\n&lt;script_schemas&gt;</c>, or an empty string if the list is empty.</returns>
+    public static string BuildScriptSchemasBlock(IReadOnlyList<AgentSkillScript> scripts)
     {
         _ = Throw.IfNull(scripts);
 
@@ -83,32 +64,23 @@ internal static class AgentInlineSkillContentBuilder
         }
 
         var sb = new StringBuilder();
-        sb.Append("\n<scripts>\n");
+        sb.Append("\n<script_schemas>\n");
 
         foreach (var script in scripts)
         {
             var parametersSchema = script.ParametersSchema;
 
-            if (script.Description is null && parametersSchema is null)
+            if (parametersSchema is null)
             {
-                sb.Append($"  <script name=\"{EscapeXmlString(script.Name)}\"/>\n");
+                sb.Append($"  <schema script=\"{EscapeXmlString(script.Name)}\"/>\n");
             }
             else
             {
-                sb.Append(script.Description is not null
-                    ? $"  <script name=\"{EscapeXmlString(script.Name)}\" description=\"{EscapeXmlString(script.Description)}\">\n"
-                    : $"  <script name=\"{EscapeXmlString(script.Name)}\">\n");
-
-                if (parametersSchema is not null)
-                {
-                    sb.Append($"    <parameters_schema>{EscapeXmlString(parametersSchema.Value.GetRawText(), preserveQuotes: true)}</parameters_schema>\n");
-                }
-
-                sb.Append("  </script>\n");
+                sb.Append($"  <schema script=\"{EscapeXmlString(script.Name)}\">{EscapeXmlString(parametersSchema.Value.GetRawText(), preserveQuotes: true)}</schema>\n");
             }
         }
 
-        sb.Append("</scripts>");
+        sb.Append("</script_schemas>");
 
         return sb.ToString();
     }

dotnet/tests/Microsoft.Agents.AI.UnitTests/AgentSkills/AgentClassSkillTests.cs

@@ -51,9 +51,8 @@ public sealed class AgentClassSkillTests
         // Act & Assert — Content is cached
         Assert.Same(await skill.GetContentAsync(), await skill.GetContentAsync());
 
-        // Act & Assert — Content includes parameter schema from typed script
-        Assert.Contains("parameters_schema", await skill.GetContentAsync());
-        Assert.Contains("value", await skill.GetContentAsync());
+        // Act & Assert — Content includes parameter schema from typed script (with preserved quotes)
+        Assert.Contains("\"value\"", await skill.GetContentAsync());
     }
 
     [Fact]
@@ -383,10 +382,9 @@ public sealed class AgentClassSkillTests
         // Arrange
         var skill = new AttributedFullSkill();
 
-        // Act & Assert — Content includes reflected resources and scripts
-        Assert.Contains("<resources>", await skill.GetContentAsync());
-        Assert.Contains("conversion-table", await skill.GetContentAsync());
-        Assert.Contains("<scripts>", await skill.GetContentAsync());
+        // Act & Assert — Content no longer includes resources in body; scripts are in script_schemas
+        Assert.DoesNotContain("<resources>", await skill.GetContentAsync());
+        Assert.Contains("<script_schemas>", await skill.GetContentAsync());
         Assert.Contains("convert", await skill.GetContentAsync());
 
         // Act & Assert — discovered members are cached
@@ -504,7 +502,7 @@ public sealed class AgentClassSkillTests
     }
 
     [Fact]
-    public async Task Content_IncludesDescription_ForReflectedResourcesAsync()
+    public async Task Content_DoesNotRenderResources_InBodyAsync()
     {
         // Arrange
         var skill = new AttributedResourcePropertiesSkill();
@@ -512,8 +510,8 @@ public sealed class AgentClassSkillTests
         // Act
         var content = await skill.GetContentAsync();
 
-        // Assert — descriptions from [Description] attribute appear in synthesized content
-        Assert.Contains("Some important data.", content);
+        // Assert — resources are no longer rendered in body content
+        Assert.DoesNotContain("<resources>", content);
     }
 
     [Fact]

dotnet/tests/Microsoft.Agents.AI.UnitTests/AgentSkills/AgentFileSkillScriptTests.cs

@@ -122,11 +122,10 @@ public sealed class AgentFileSkillScriptTests
 
         // Assert — content starts with original and appends per-script entries
         Assert.StartsWith("Original content", content);
-        Assert.Contains("<scripts>", content);
-        Assert.Contains("<script name=\"build\">", content);
-        Assert.Contains("<script name=\"deploy\">", content);
-        Assert.Contains("<parameters_schema>", content);
-        Assert.Contains("</scripts>", content);
+        Assert.Contains("<script_schemas>", content);
+        Assert.Contains("<schema script=\"build\">", content);
+        Assert.Contains("<schema script=\"deploy\">", content);
+        Assert.Contains("</script_schemas>", content);
     }
 
     [Fact]

dotnet/tests/Microsoft.Agents.AI.UnitTests/AgentSkills/AgentInlineSkillTests.cs

@@ -149,7 +149,7 @@ public sealed class AgentInlineSkillTests
     }
 
     [Fact]
-    public async Task Content_IncludesResourcesAddedBeforeFirstAccessAsync()
+    public async Task Content_DoesNotIncludeResourcesInBodyAsync()
     {
         // Arrange
         var skill = new AgentInlineSkill("my-skill", "A valid skill.", "Instructions.");
@@ -158,13 +158,12 @@ public sealed class AgentInlineSkillTests
         // Act
         var content = await skill.GetContentAsync();
 
-        // Assert
-        Assert.Contains("<resources>", content);
-        Assert.Contains("config", content);
+        // Assert — resources are no longer rendered in the body; they're accessed via GetResourceAsync
+        Assert.DoesNotContain("<resources>", content);
     }
 
     [Fact]
-    public async Task Content_IncludesDelegateResourcesAddedBeforeFirstAccessAsync()
+    public async Task Content_DoesNotIncludeDelegateResourcesInBodyAsync()
     {
         // Arrange
         var skill = new AgentInlineSkill("my-skill", "A valid skill.", "Instructions.");
@@ -173,9 +172,8 @@ public sealed class AgentInlineSkillTests
         // Act
         var content = await skill.GetContentAsync();
 
-        // Assert
-        Assert.Contains("<resources>", content);
-        Assert.Contains("dynamic", content);
+        // Assert — resources are no longer rendered in the body
+        Assert.DoesNotContain("<resources>", content);
     }
 
     [Fact]
@@ -189,7 +187,7 @@ public sealed class AgentInlineSkillTests
         var content = await skill.GetContentAsync();
 
         // Assert
-        Assert.Contains("<scripts>", content);
+        Assert.Contains("<script_schemas>", content);
         Assert.Contains("run", content);
     }
 
@@ -209,7 +207,7 @@ public sealed class AgentInlineSkillTests
     }
 
     [Fact]
-    public async Task Content_IncludesResourcesAndScriptsAddedBeforeFirstAccessAsync()
+    public async Task Content_IncludesScriptSchemasAddedBeforeFirstAccessAsync()
     {
         // Arrange
         var skill = new AgentInlineSkill("my-skill", "A valid skill.", "Instructions.");
@@ -220,9 +218,8 @@ public sealed class AgentInlineSkillTests
         var content = await skill.GetContentAsync();
 
         // Assert
-        Assert.Contains("<resources>", content);
-        Assert.Contains("r1", content);
-        Assert.Contains("<scripts>", content);
+        Assert.DoesNotContain("<resources>", content);
+        Assert.Contains("<script_schemas>", content);
         Assert.Contains("s1", content);
     }
 
@@ -236,8 +233,9 @@ public sealed class AgentInlineSkillTests
         // Act
         var content = await skill.GetContentAsync();
 
-        // Assert — JSON schema should be present and XML content chars escaped
-        Assert.Contains("parameters_schema", content);
+        // Assert — JSON schema should be present inside <schema> element (no extra wrapper) with preserved quotes
+        Assert.Contains("<schema script=\"search\">", content);
+        Assert.Contains("\"query\"", content);
         Assert.DoesNotContain("<![CDATA[", content);
     }
 
@@ -429,7 +427,7 @@ public sealed class AgentInlineSkillTests
 
         // Assert
         Assert.DoesNotContain("<resources>", content);
-        Assert.DoesNotContain("<scripts>", content);
+        Assert.DoesNotContain("<script_schemas>", content);
     }
 
     [Fact]
@@ -463,7 +461,7 @@ public sealed class AgentInlineSkillTests
     }
 
     [Fact]
-    public async Task Content_ScriptWithDescription_IncludesDescriptionAttributeAsync()
+    public async Task Content_ScriptWithDescription_DoesNotEmitDescriptionAttributeAsync()
     {
         // Arrange
         var skill = new AgentInlineSkill("my-skill", "A valid skill.", "Instructions.");
@@ -472,8 +470,10 @@ public sealed class AgentInlineSkillTests
         // Act
         var content = await skill.GetContentAsync();
 
-        // Assert
-        Assert.Contains("description=\"Runs something.\"", content);
+        // Assert — description is no longer emitted in the script_schemas block;
+        // the block only contains parameter schemas for calling scripts.
+        Assert.Contains("<schema script=\"my-script\"", content);
+        Assert.DoesNotContain("description=\"Runs something.\"", content);
     }
 
     [Fact]
@@ -492,7 +492,7 @@ public sealed class AgentInlineSkillTests
     }
 
     [Fact]
-    public async Task Content_ResourceWithDescription_IncludesDescriptionAttributeAsync()
+    public async Task Content_ResourceWithDescription_NotRenderedInBodyAsync()
     {
         // Arrange
         var skill = new AgentInlineSkill("my-skill", "A valid skill.", "Instructions.");
@@ -502,9 +502,10 @@ public sealed class AgentInlineSkillTests
         // Act
         var content = await skill.GetContentAsync();
 
-        // Assert
-        Assert.Contains("description=\"A described resource.\"", content);
-        Assert.DoesNotContain("no-desc\" description", content);
+        // Assert — resources are no longer rendered in the body
+        Assert.DoesNotContain("<resources>", content);
+        Assert.DoesNotContain("with-desc", content);
+        Assert.DoesNotContain("no-desc", content);
     }
 
     [Fact]

python/CHANGELOG.md

@@ -7,6 +7,43 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 ## [Unreleased]
 
+## [1.8.0] - 2026-06-04
+
+### Added
+- **agent-framework-core**: Add MCP-based skills discovery (`McpSkillsSource`) ([#6169](https://github.com/microsoft/agent-framework/pull/6169))
+- **agent-framework-core**: Progressive tool exposure via `FunctionInvocationContext` ([#6233](https://github.com/microsoft/agent-framework/pull/6233))
+- **agent-framework-core**: Add background agent support to harness agent ([#6155](https://github.com/microsoft/agent-framework/pull/6155))
+- **agent-framework-core**: Add `AgentFileStore` and `FileAccessProvider` for file access operations ([#6099](https://github.com/microsoft/agent-framework/pull/6099))
+- **agent-framework-core**: Coalesce code interpreter history chunks ([#5801](https://github.com/microsoft/agent-framework/pull/5801))
+- **agent-framework-core**: Run sync tools off the event loop ([#5773](https://github.com/microsoft/agent-framework/pull/5773))
+- **agent-framework-bedrock**: Implement native structured output support via Converse API ([#6052](https://github.com/microsoft/agent-framework/pull/6052))
+- **agent-framework-foundry**: Add Foundry Adaptive Evals integration for rubric-generation ([#6101](https://github.com/microsoft/agent-framework/pull/6101))
+- **agent-framework-foundry**: Add `timeout` parameter to `FoundryAgent` to fix `ConnectTimeout` on multi-turn conversations ([#6263](https://github.com/microsoft/agent-framework/pull/6263))
+- **agent-framework-mistral**: Add Mistral AI embedding client package ([#5480](https://github.com/microsoft/agent-framework/pull/5480))
+- **agent-framework-a2a**: Expose `supported_protocol_bindings` as configurable parameter ([#6098](https://github.com/microsoft/agent-framework/pull/6098))
+- **agent-framework-a2a**: Set `message_id` on `AgentResponseUpdate` for message-bearing paths ([#6163](https://github.com/microsoft/agent-framework/pull/6163))
+- **agent-framework-foundry-hosting**: Persist hosted MCP call/results as canonical `mcp_call` output ([#6070](https://github.com/microsoft/agent-framework/pull/6070))
+
+### Changed
+- **agent-framework-github-copilot**: [BREAKING] Upgrade `github-copilot-sdk` to v1.0.0 (stable) ([#6292](https://github.com/microsoft/agent-framework/pull/6292))
+- **agent-framework-core**: [BREAKING — experimental] Refactor Skill API to async resource and script lookup ([#6135](https://github.com/microsoft/agent-framework/pull/6135))
+- **agent-framework-github-copilot**: Promote to release candidate (`1.0.0rc1`)
+- **agent-framework-declarative**: Promote to release candidate (`1.0.0rc1`) ([#6256](https://github.com/microsoft/agent-framework/pull/6256))
+
+### Fixed
+- **agent-framework-core**: Fix compaction message-id collisions and tool-loop summary persistence ([#6299](https://github.com/microsoft/agent-framework/pull/6299))
+- **agent-framework-core**: Fix observability unsafe serialization of function-call arguments containing dataclass/framework objects ([#6026](https://github.com/microsoft/agent-framework/pull/6026))
+- **agent-framework-core**: Consolidate MCP reliability fixes ([#6145](https://github.com/microsoft/agent-framework/pull/6145))
+- **agent-framework-core**: Backfill chat span request model if unknown and response model is available ([#6160](https://github.com/microsoft/agent-framework/pull/6160))
+- **agent-framework-anthropic**: Skip orphan anthropic thinking signatures ([#5784](https://github.com/microsoft/agent-framework/pull/5784))
+- **agent-framework-foundry**: Fix `FoundryAgent` stripping model from `PromptAgent` requests ([#5526](https://github.com/microsoft/agent-framework/pull/5526))
+- **agent-framework-foundry-hosting**: Fix toolbox consent flow in hosted agent ([#6249](https://github.com/microsoft/agent-framework/pull/6249))
+- **agent-framework-foundry-hosting**: Drop hosted MCP calls when reasoning is stripped ([#6210](https://github.com/microsoft/agent-framework/pull/6210))
+- **agent-framework-openai**: Fix OTLP HTTP base-endpoint losing `/v1/{signal}` auto-append ([#5913](https://github.com/microsoft/agent-framework/pull/5913))
+- **agent-framework-openai**: Drop hosted MCP calls when reasoning is stripped ([#6210](https://github.com/microsoft/agent-framework/pull/6210))
+- **agent-framework-orchestrations**: Fix spurious Magentic custom manager warning ([#6261](https://github.com/microsoft/agent-framework/pull/6261))
+- **agent-framework-azurefunctions**: Fix integration test worker crashes on Py3.13 ([#4260](https://github.com/microsoft/agent-framework/pull/4260))
+
 ## [1.7.0] - 2026-05-28
 
 ### Added
@@ -1132,7 +1169,8 @@ Release candidate for **agent-framework-core** and **agent-framework-azure-ai**
 
 For more information, see the [announcement blog post](https://devblogs.microsoft.com/foundry/introducing-microsoft-agent-framework-the-open-source-engine-for-agentic-ai-apps/).
 
-[Unreleased]: https://github.com/microsoft/agent-framework/compare/python-1.7.0...HEAD
+[Unreleased]: https://github.com/microsoft/agent-framework/compare/python-1.8.0...HEAD
+[1.8.0]: https://github.com/microsoft/agent-framework/compare/python-1.7.0...python-1.8.0
 [1.7.0]: https://github.com/microsoft/agent-framework/compare/python-1.6.0...python-1.7.0
 [1.6.0]: https://github.com/microsoft/agent-framework/compare/python-1.5.0...python-1.6.0
 [1.5.0]: https://github.com/microsoft/agent-framework/compare/python-1.4.0...python-1.5.0

python/PACKAGE_STATUS.md

@@ -33,7 +33,7 @@ Status is grouped into these buckets:
 | `agent-framework-foundry` | `python/packages/foundry` | `released` |
 | `agent-framework-foundry-local` | `python/packages/foundry_local` | `beta` |
 | `agent-framework-gemini` | `python/packages/gemini` | `alpha` |
-| `agent-framework-github-copilot` | `python/packages/github_copilot` | `beta` |
+| `agent-framework-github-copilot` | `python/packages/github_copilot` | `rc` |
 | `agent-framework-hyperlight` | `python/packages/hyperlight` | `beta` |
 | `agent-framework-lab` | `python/packages/lab` | `beta` |
 | `agent-framework-mem0` | `python/packages/mem0` | `beta` |

python/packages/a2a/pyproject.toml

@@ -4,7 +4,7 @@ description = "A2A integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b260528"
+version = "1.0.0b260604"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,7 +23,7 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core>=1.7.0,<2",
+    "agent-framework-core>=1.8.0,<2",
     "a2a-sdk>=1.0.0,<2",
 ]
 

python/packages/anthropic/pyproject.toml

@@ -4,7 +4,7 @@ description = "Anthropic integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b260521"
+version = "1.0.0b260604"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,7 +23,7 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core>=1.6.0,<2",
+    "agent-framework-core>=1.8.0,<2",
     "anthropic>=0.80.0,<0.80.1",
 ]
 

python/packages/azurefunctions/pyproject.toml

@@ -4,7 +4,7 @@ description = "Azure Functions integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b260521"
+version = "1.0.0b260604"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -22,8 +22,8 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core>=1.6.0,<2",
-    "agent-framework-durabletask>=1.0.0b260521,<2",
+    "agent-framework-core>=1.8.0,<2",
+    "agent-framework-durabletask>=1.0.0b260604,<2",
     "azure-functions>=1.24.0,<2",
     "azure-functions-durable>=1.3.1,<2",
 ]

python/packages/bedrock/agent_framework_bedrock/_chat_client.py

@@ -795,10 +795,7 @@ class BedrockChatClient(
             schema = copy.deepcopy(schema_src)
         else:
             if not isinstance(response_format, type) or not issubclass(response_format, BaseModel):
-                raise TypeError(
-                    "response_format must be None, a dict JSON schema, "
-                    "or a Pydantic BaseModel subclass."
-                )
+                raise TypeError("response_format must be None, a dict JSON schema, or a Pydantic BaseModel subclass.")
             # response_format is a Pydantic model class
             schema = response_format.model_json_schema()
             name = response_format.__name__
@@ -817,9 +814,7 @@ class BedrockChatClient(
         return {
             "textFormat": {
                 "type": "json_schema",
-                "structure": {
-                    "jsonSchema": json_schema
-                },
+                "structure": {"jsonSchema": json_schema},
             }
         }
 
@@ -840,9 +835,7 @@ class BedrockChatClient(
                 if node_id in visited:
                     return
                 visited.add(node_id)
-                if node.get("type") == "object" or (
-                    "properties" in node and "type" not in node
-                ):
+                if node.get("type") == "object" or ("properties" in node and "type" not in node):
                     existing = node.get("additionalProperties")
                     if existing is None or existing is True:
                         node["additionalProperties"] = False

python/packages/bedrock/pyproject.toml

@@ -4,7 +4,7 @@ description = "Amazon Bedrock integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b260521"
+version = "1.0.0b260604"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,7 +23,7 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core>=1.6.0,<2",
+    "agent-framework-core>=1.8.0,<2",
     "boto3>=1.35.0,<2.0.0",
     "botocore>=1.35.0,<2.0.0",
 ]

python/packages/bedrock/tests/test_bedrock_structured_output.py

@@ -238,6 +238,7 @@ async def test_chat_response_value_populated_streaming() -> None:
 
 async def test_unsupported_model_validation_exception() -> None:
     """When a model doesn't support outputConfig, a clear error should be raised."""
+
     class _FailingStubBedrockRuntime:
         def converse(self, **kwargs: Any) -> dict[str, Any]:
             # Simulate botocore ClientError for ValidationException

python/packages/core/agent_framework/_clients.py

@@ -380,8 +380,15 @@ class BaseChatClient(SerializationMixin, ABC, Generic[OptionsCoT]):
             return prepared_messages
         from ._compaction import apply_compaction
 
+        # Compact the caller's list in place when possible. A compaction operation has
+        # two halves: exclusion flags (mutated on shared Message objects) and inserted
+        # summary messages. Operating on the original list keeps both halves on the list
+        # the function-invocation tool loop reuses across iterations; otherwise inserted
+        # summaries would be lost on a throwaway copy while exclusions persisted, silently
+        # dropping older groups (issue #4991).
+        working_messages = messages if isinstance(messages, list) else prepared_messages
         return await apply_compaction(
-            prepared_messages,
+            working_messages,
             strategy=compaction_strategy,
             tokenizer=tokenizer,
         )

python/packages/core/agent_framework/_compaction.py

@@ -4,7 +4,7 @@ from __future__ import annotations
 
 import json
 import logging
-from collections.abc import Mapping, Sequence
+from collections.abc import Iterable, Mapping, Sequence
 from typing import (
     TYPE_CHECKING,
     Any,
@@ -92,10 +92,23 @@ def _is_reasoning_only_assistant(message: Message) -> bool:
     return all(content.type == "text_reasoning" for content in message.contents)
 
 
-def _ensure_message_ids(messages: list[Message]) -> None:
+def _ensure_message_ids(
+    messages: list[Message], *, id_offset: int = 0, reserved_ids: Iterable[str] | None = None
+) -> None:
+    existing_ids: set[str] = set(reserved_ids) if reserved_ids is not None else set()
+    existing_ids.update(message.message_id for message in messages if message.message_id)
     for index, message in enumerate(messages):
-        if not message.message_id:
-            message.message_id = f"msg_{index}"
+        if message.message_id:
+            continue
+        candidate = f"msg_{id_offset + index}"
+        if candidate in existing_ids:
+            counter = id_offset + len(messages)
+            candidate = f"msg_{counter}"
+            while candidate in existing_ids:
+                counter += 1
+                candidate = f"msg_{counter}"
+        message.message_id = candidate
+        existing_ids.add(candidate)
 
 
 def _group_id_for(message: Message, group_index: int) -> str:
@@ -104,14 +117,27 @@ def _group_id_for(message: Message, group_index: int) -> str:
     return f"group_index_{group_index}"
 
 
-def group_messages(messages: list[Message]) -> list[dict[str, Any]]:
+def group_messages(
+    messages: list[Message], *, id_offset: int = 0, reserved_ids: Iterable[str] | None = None
+) -> list[dict[str, Any]]:
     """Compute group spans and metadata for annotation.
 
+    Args:
+        messages: The messages (or a slice of them) to group.
+
+    Keyword Args:
+        id_offset: Absolute starting index used when auto-assigning ``message_id``
+            values, so incremental annotation of a list slice produces ids that
+            stay unique across the full list.
+        reserved_ids: Message ids that already exist outside ``messages`` (for
+            example in a preserved prefix). Auto-assigned ids are guaranteed not
+            to collide with these, preventing duplicate ids across the full list.
+
     Returns:
         Ordered list of lightweight span dicts with keys:
         ``group_id``, ``kind``, ``start_index``, ``end_index``, ``has_reasoning``.
     """
-    _ensure_message_ids(messages)
+    _ensure_message_ids(messages, id_offset=id_offset, reserved_ids=reserved_ids)
     spans: list[dict[str, Any]] = []
     i = 0
     group_index = 0
@@ -439,7 +465,8 @@ def annotate_message_groups(
         if previous_group_index is not None:
             group_index_offset = previous_group_index + 1
 
-    spans = group_messages(messages[start_index:])
+    reserved_ids = {message.message_id for message in messages[:start_index] if message.message_id}
+    spans = group_messages(messages[start_index:], id_offset=start_index, reserved_ids=reserved_ids)
     for span_index, span in enumerate(spans):
         group_id = str(span["group_id"])
         kind = _coerce_group_kind(span["kind"])

python/packages/core/agent_framework/_harness/_background_agents.py

@@ -349,6 +349,8 @@ class BackgroundAgentsProvider(ContextProvider):
             _save_provider_state(session, provider_state, source_id=source_id)
             return f"Background task {task_id} started on agent '{agent_name}'."
 
+        background_agents_start_task._invoke_sync_on_event_loop = True  # pyright: ignore[reportPrivateUsage]
+
         @tool(name="background_agents_wait_for_first_completion", approval_mode="never_require")
         async def background_agents_wait_for_first_completion(task_ids: list[int]) -> str:
             """Block until the first of the specified background tasks completes. Returns the completed task's ID."""
@@ -471,6 +473,8 @@ class BackgroundAgentsProvider(ContextProvider):
             _save_provider_state(session, provider_state, source_id=source_id)
             return f"Task {task_id} continued with new input."
 
+        background_agents_continue_task._invoke_sync_on_event_loop = True  # pyright: ignore[reportPrivateUsage]
+
         @tool(name="background_agents_clear_completed_task", approval_mode="never_require")
         def background_agents_clear_completed_task(task_id: int) -> str:
             """Remove a completed or failed task and release its session to free memory."""

python/packages/core/agent_framework/_tools.py

@@ -292,6 +292,7 @@ class FunctionTool(SerializationMixin):
         "_cached_parameters",
         "_input_schema",
         "_schema_supplied",
+        "_invoke_sync_on_event_loop",
     }
 
     def __init__(
@@ -366,6 +367,7 @@ class FunctionTool(SerializationMixin):
         self.description = description
         self.kind = kind
         self.additional_properties = additional_properties
+        self._invoke_sync_on_event_loop = False
         for key, value in kwargs.items():
             setattr(self, key, value)
 
@@ -537,6 +539,16 @@ class FunctionTool(SerializationMixin):
             self.invocation_exception_count += 1
             raise
 
+    async def _invoke_function(self, call_kwargs: Mapping[str, Any]) -> Any:
+        """Run sync tools off the event loop during async invocation."""
+        func = self.func.func if isinstance(self.func, FunctionTool) else self.func
+        if inspect.iscoroutinefunction(func) or getattr(self, "_invoke_sync_on_event_loop", False):
+            res = self.__call__(**call_kwargs)
+            return await res if inspect.isawaitable(res) else res
+
+        res = await asyncio.to_thread(self.__call__, **call_kwargs)
+        return await res if inspect.isawaitable(res) else res
+
     @overload
     async def invoke(
         self,
@@ -679,8 +691,7 @@ class FunctionTool(SerializationMixin):
         if not OBSERVABILITY_SETTINGS.ENABLED:  # type: ignore[name-defined]
             logger.info(f"Function name: {self.name}")
             logger.debug(f"Function arguments: {observable_kwargs}")
-            res = self.__call__(**call_kwargs)
-            result = await res if inspect.isawaitable(res) else res
+            result = await self._invoke_function(call_kwargs)
             if skip_parsing:
                 logger.info(f"Function {self.name} succeeded.")
                 logger.debug(f"Function result: {type(result).__name__}")
@@ -730,8 +741,7 @@ class FunctionTool(SerializationMixin):
             start_time_stamp = perf_counter()
             end_time_stamp: float | None = None
             try:
-                res = self.__call__(**call_kwargs)
-                result = await res if inspect.isawaitable(res) else res
+                result = await self._invoke_function(call_kwargs)
                 end_time_stamp = perf_counter()
             except Exception as exception:
                 end_time_stamp = perf_counter()

python/packages/core/pyproject.toml

@@ -4,7 +4,7 @@ description = "Microsoft Agent Framework for building AI Agents with Python. Thi
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.7.0"
+version = "1.8.0"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"

python/packages/core/tests/core/test_clients.py

@@ -11,10 +11,14 @@ from agent_framework import (
     GROUP_TOKEN_COUNT_KEY,
     BaseChatClient,
     ChatResponse,
+    ChatResponseUpdate,
+    Content,
     Message,
     SlidingWindowStrategy,
     SupportsChatGetResponse,
+    ToolResultCompactionStrategy,
     TruncationStrategy,
+    tool,
 )
 
 
@@ -258,6 +262,196 @@ async def test_base_client_default_tokenizer_without_strategy_annotates_messages
     assert captured_token_counts == [[19, 19]]
 
 
+def _tool_call_response(call_id: str, location: str) -> ChatResponse:
+    return ChatResponse(
+        messages=Message(
+            role="assistant",
+            contents=[
+                Content.from_function_call(
+                    call_id=call_id,
+                    name="lookup_weather",
+                    arguments=f'{{"location": "{location}"}}',
+                )
+            ],
+        ),
+        response_id=f"resp_{call_id}",
+    )
+
+
+def _is_tool_result_summary(message: Message) -> bool:
+    text = message.text or ""
+    return message.role == "assistant" and text.startswith("[Tool results:")
+
+
+async def test_function_loop_persists_inserted_summaries_across_iterations(
+    chat_client_base: SupportsChatGetResponse,
+) -> None:
+    # Regression test for #4991: compaction inserts summary messages and excludes the
+    # originals. Across tool-loop iterations the exclusion flags persisted (shared Message
+    # objects) but the inserted summaries were dropped (they only lived on a throwaway copy),
+    # so older tool groups were silently lost with no summary representing them.
+    chat_client_base.function_invocation_configuration["enabled"] = True  # type: ignore[attr-defined]
+    chat_client_base.function_invocation_configuration["max_iterations"] = 3  # type: ignore[attr-defined]
+    chat_client_base.compaction_strategy = ToolResultCompactionStrategy(keep_last_tool_call_groups=1)  # type: ignore[attr-defined]
+
+    @tool(name="lookup_weather", approval_mode="never_require")
+    def lookup_weather(location: str) -> str:
+        return f"Weather in {location}: sunny"
+
+    chat_client_base.run_responses = [  # type: ignore[attr-defined]
+        _tool_call_response("call_1", "London"),
+        _tool_call_response("call_2", "Paris"),
+        _tool_call_response("call_3", "Tokyo"),
+    ]
+
+    captured_inputs: list[list[Message]] = []
+    original = chat_client_base._get_non_streaming_response  # type: ignore[attr-defined]
+
+    async def _capture(
+        *,
+        messages: list[Message],
+        options: dict[str, Any],
+        **kwargs: Any,
+    ) -> ChatResponse:
+        captured_inputs.append(list(messages))
+        return await original(messages=messages, options=options, **kwargs)
+
+    chat_client_base._get_non_streaming_response = _capture  # type: ignore[attr-defined,method-assign]
+
+    await chat_client_base.get_response(
+        [Message(role="user", contents=["What is the weather in London?"])],
+        options={"tools": [lookup_weather]},  # type: ignore[typeddict-unknown-key]
+    )
+
+    # The final model call should represent every compacted tool group with a summary.
+    # Two older tool groups get collapsed (London, Paris) while the last (Tokyo) is kept.
+    final_input = captured_inputs[-1]
+    summaries = [message for message in final_input if _is_tool_result_summary(message)]
+    summary_text = " ".join(message.text or "" for message in summaries)
+
+    assert len(summaries) == 2, [message.text for message in final_input]
+    assert "London" in summary_text
+    assert "Paris" in summary_text
+
+
+def _tool_call_update(call_id: str, location: str) -> list[ChatResponseUpdate]:
+    return [
+        ChatResponseUpdate(
+            contents=[
+                Content.from_function_call(
+                    call_id=call_id,
+                    name="lookup_weather",
+                    arguments=f'{{"location": "{location}"}}',
+                )
+            ],
+            role="assistant",
+            finish_reason="stop",
+            response_id=f"resp_{call_id}",
+        )
+    ]
+
+
+async def test_function_loop_persists_inserted_summaries_across_iterations_streaming(
+    chat_client_base: SupportsChatGetResponse,
+) -> None:
+    # Streaming counterpart of the #4991 regression test: the summary persistence fix in
+    # ``_prepare_messages_for_model_call`` must cover the streaming tool loop too.
+    chat_client_base.function_invocation_configuration["enabled"] = True  # type: ignore[attr-defined]
+    chat_client_base.function_invocation_configuration["max_iterations"] = 3  # type: ignore[attr-defined]
+    chat_client_base.compaction_strategy = ToolResultCompactionStrategy(keep_last_tool_call_groups=1)  # type: ignore[attr-defined]
+
+    @tool(name="lookup_weather", approval_mode="never_require")
+    def lookup_weather(location: str) -> str:
+        return f"Weather in {location}: sunny"
+
+    chat_client_base.streaming_responses = [  # type: ignore[attr-defined]
+        _tool_call_update("call_1", "London"),
+        _tool_call_update("call_2", "Paris"),
+        _tool_call_update("call_3", "Tokyo"),
+    ]
+
+    captured_inputs: list[list[Message]] = []
+    original = chat_client_base._get_streaming_response  # type: ignore[attr-defined]
+
+    def _capture(
+        *,
+        messages: list[Message],
+        options: dict[str, Any],
+        **kwargs: Any,
+    ):
+        captured_inputs.append(list(messages))
+        return original(messages=messages, options=options, **kwargs)
+
+    chat_client_base._get_streaming_response = _capture  # type: ignore[attr-defined,method-assign]
+
+    stream = chat_client_base.get_response(
+        [Message(role="user", contents=["What is the weather in London?"])],
+        stream=True,
+        options={"tools": [lookup_weather]},  # type: ignore[typeddict-unknown-key]
+    )
+    async for _ in stream:
+        pass
+
+    final_input = captured_inputs[-1]
+    summaries = [message for message in final_input if _is_tool_result_summary(message)]
+    summary_text = " ".join(message.text or "" for message in summaries)
+
+    assert len(summaries) == 2, [message.text for message in final_input]
+    assert "London" in summary_text
+    assert "Paris" in summary_text
+
+
+async def test_function_loop_compaction_conversation_id_mode_does_not_resend_history(
+    chat_client_base: SupportsChatGetResponse,
+) -> None:
+    # In conversation-id mode the server owns prior context, so the tool loop clears
+    # ``prepped_messages`` and only sends the latest message. Compaction must not fight that
+    # by re-inserting summaries or re-sending earlier turns.
+    chat_client_base.function_invocation_configuration["enabled"] = True  # type: ignore[attr-defined]
+    chat_client_base.function_invocation_configuration["max_iterations"] = 3  # type: ignore[attr-defined]
+    chat_client_base.compaction_strategy = ToolResultCompactionStrategy(keep_last_tool_call_groups=1)  # type: ignore[attr-defined]
+
+    @tool(name="lookup_weather", approval_mode="never_require")
+    def lookup_weather(location: str) -> str:
+        return f"Weather in {location}: sunny"
+
+    def _conversation_tool_call(call_id: str, location: str) -> ChatResponse:
+        response = _tool_call_response(call_id, location)
+        response.conversation_id = "conv_1"
+        return response
+
+    chat_client_base.run_responses = [  # type: ignore[attr-defined]
+        _conversation_tool_call("call_1", "London"),
+        _conversation_tool_call("call_2", "Paris"),
+        _conversation_tool_call("call_3", "Tokyo"),
+    ]
+
+    captured_inputs: list[list[Message]] = []
+    original = chat_client_base._get_non_streaming_response  # type: ignore[attr-defined]
+
+    async def _capture(
+        *,
+        messages: list[Message],
+        options: dict[str, Any],
+        **kwargs: Any,
+    ) -> ChatResponse:
+        captured_inputs.append(list(messages))
+        return await original(messages=messages, options=options, **kwargs)
+
+    chat_client_base._get_non_streaming_response = _capture  # type: ignore[attr-defined,method-assign]
+
+    await chat_client_base.get_response(
+        [Message(role="user", contents=["What is the weather in London?"])],
+        options={"tools": [lookup_weather]},  # type: ignore[typeddict-unknown-key]
+    )
+
+    # After the conversation id is established the loop only forwards the latest message,
+    # so subsequent model calls never receive the full history or summary messages.
+    for sent in captured_inputs[1:]:
+        assert len(sent) <= 1, [message.text for message in sent]
+        assert not any(_is_tool_result_summary(message) for message in sent)
+
+
 def test_base_client_as_agent_does_not_copy_client_compaction_defaults(
     chat_client_base: SupportsChatGetResponse,
 ) -> None:

python/packages/core/tests/core/test_compaction.py

@@ -196,6 +196,64 @@ def test_append_compaction_message_annotates_new_message() -> None:
     assert isinstance(_group_id(messages[1]), str)
 
 
+def test_incremental_annotation_assigns_unique_message_ids() -> None:
+    # Regression test for #5237: ``_ensure_message_ids`` assigned ``msg_{index}``
+    # using the position within the slice handed to ``group_messages``. Successive
+    # incremental annotations restart the index at 0, so distinct messages collided
+    # on the same ``message_id``.
+    messages: list[Message] = []
+    for turn in range(4):
+        messages.append(Message(role="user", contents=[f"user {turn}"]))
+        annotate_message_groups(messages)
+        messages.append(Message(role="assistant", contents=[f"assistant {turn}"]))
+        annotate_message_groups(messages)
+
+    message_ids = [message.message_id for message in messages]
+    assert all(message_ids), "every message should receive an id"
+    assert len(set(message_ids)) == len(message_ids), f"duplicate message ids: {message_ids}"
+
+
+def test_ensure_message_ids_avoids_existing_id_collisions() -> None:
+    # An auto-generated ``msg_{index}`` must not collide with an id already present
+    # on another message (user-supplied or assigned by an earlier annotation pass).
+    messages = [
+        Message(role="user", contents=["zero"]),
+        Message(role="assistant", contents=["one"], message_id="msg_2"),
+        Message(role="user", contents=["two"]),
+    ]
+    annotate_message_groups(messages)
+
+    message_ids = [message.message_id for message in messages]
+    assert message_ids[1] == "msg_2"
+    assert len(set(message_ids)) == len(message_ids), f"duplicate message ids: {message_ids}"
+
+
+def test_incremental_annotation_avoids_prefix_id_collision() -> None:
+    # Regression for the PR review on #5237: when only a suffix is re-annotated,
+    # an auto-assigned ``msg_{index}`` in the suffix must not collide with a
+    # preexisting id carried by a message in the *preserved prefix* (a group
+    # before the one re-annotation pulls back to). Otherwise ``_group_id_for``
+    # derives the same group id and merges groups across the boundary.
+    messages = [
+        # Out-of-position, user-supplied id that matches the ``msg_{index}`` the
+        # suffix pass would assign to the appended message below. This message is
+        # two groups back, so it stays outside the re-annotated slice.
+        Message(role="user", contents=["zero"], message_id="msg_2"),
+        Message(role="user", contents=["one"]),
+    ]
+    annotate_message_groups(messages)
+    assert messages[0].message_id == "msg_2"
+    assert messages[1].message_id == "msg_1"
+
+    messages.append(Message(role="user", contents=["two"]))
+    annotate_message_groups(messages, from_index=2)
+
+    message_ids = [message.message_id for message in messages]
+    assert all(message_ids), "every message should receive an id"
+    assert len(set(message_ids)) == len(message_ids), f"duplicate message ids: {message_ids}"
+    assert messages[0].message_id == "msg_2"
+
+
 async def test_truncation_strategy_keeps_system_anchor() -> None:
     messages = [
         Message(role="system", contents=["you are helpful"]),
@@ -484,6 +542,44 @@ async def test_tool_result_compaction_collapses_old_groups_into_summary() -> Non
     assert any(m.role == "tool" for m in projected)
 
 
+async def test_tool_result_compaction_is_idempotent_after_summary_insertion() -> None:
+    """Re-running compaction after a mid-list summary insertion must not duplicate it.
+
+    Mirrors a subsequent tool-loop iteration (issue #4991): the inserted summary and the
+    excluded originals now persist on the same list, so a second annotate + compaction pass
+    over the same groups should be a no-op rather than collapsing the group again.
+    """
+    messages = [
+        Message(role="user", contents=["u"]),
+        _assistant_function_call("call-1"),
+        _tool_result("call-1", "r1"),
+        _assistant_function_call("call-2"),
+        _tool_result("call-2", "r2"),
+        Message(role="assistant", contents=["done"]),
+    ]
+    strategy = ToolResultCompactionStrategy(keep_last_tool_call_groups=1)
+    annotate_message_groups(messages)
+    assert await strategy(messages) is True
+
+    summaries_after_first = [m for m in messages if (m.text or "").startswith("[Tool results:")]
+    assert len(summaries_after_first) == 1
+    summary = summaries_after_first[0]
+    summary_group_ids = _group_unknown_value(summary, SUMMARY_OF_GROUP_IDS_KEY)
+
+    # Second pass over the same (now partially compacted) list.
+    annotate_message_groups(messages)
+    changed = await strategy(messages)
+
+    assert changed is False
+    summaries_after_second = [m for m in messages if (m.text or "").startswith("[Tool results:")]
+    assert len(summaries_after_second) == 1
+    assert _group_unknown_value(summaries_after_second[0], SUMMARY_OF_GROUP_IDS_KEY) == summary_group_ids
+
+    # The kept tool-call group stays atomic and included.
+    projected = included_messages(messages)
+    assert any(m.role == "tool" for m in projected)
+
+
 async def test_tool_result_compaction_zero_collapses_all() -> None:
     """With keep=0, all tool-call groups are collapsed into summaries."""
     messages = [

python/packages/core/tests/core/test_tools.py

@@ -1,4 +1,6 @@
 # Copyright (c) Microsoft. All rights reserved.
+import asyncio
+import threading
 from typing import Annotated, Any, Literal, get_args, get_origin
 from unittest.mock import Mock
 
@@ -1346,6 +1348,45 @@ async def test_invoke_skip_parsing_awaits_async_functions() -> None:
     assert raw == 42
 
 
+async def test_invoke_sync_tool_does_not_block_event_loop() -> None:
+    release_tool = threading.Event()
+    tool_thread_ids: list[int] = []
+    event_loop_thread_id = threading.get_ident()
+
+    @tool
+    def wait_for_release() -> str:
+        tool_thread_ids.append(threading.get_ident())
+        return "released" if release_tool.wait(timeout=0.2) else "timed out"
+
+    async def release_soon() -> None:
+        await asyncio.sleep(0.01)
+        release_tool.set()
+
+    tool_task = asyncio.create_task(wait_for_release.invoke(skip_parsing=True))
+    release_task = asyncio.create_task(release_soon())
+
+    assert await asyncio.wait_for(tool_task, timeout=1) == "released"
+    await release_task
+    assert tool_thread_ids
+    assert tool_thread_ids[0] != event_loop_thread_id
+
+
+async def test_invoke_sync_tool_can_stay_on_event_loop() -> None:
+    event_loop_thread_id = threading.get_ident()
+    tool_thread_ids: list[int] = []
+
+    @tool
+    def needs_event_loop() -> str:
+        tool_thread_ids.append(threading.get_ident())
+        asyncio.get_running_loop()
+        return "ok"
+
+    needs_event_loop._invoke_sync_on_event_loop = True
+
+    assert await needs_event_loop.invoke(skip_parsing=True) == "ok"
+    assert tool_thread_ids == [event_loop_thread_id]
+
+
 async def test_invoke_skip_parsing_bypasses_configured_result_parser() -> None:
     """The tool's own result_parser is bypassed when skip_parsing=True is requested."""
     parser_calls: list[Any] = []

python/packages/foundry/agent_framework_foundry/_agent.py

@@ -191,6 +191,7 @@ class RawFoundryAgentChatClient(  # type: ignore[misc]
         compaction_strategy: CompactionStrategy | None = None,
         tokenizer: TokenizerProtocol | None = None,
         additional_properties: dict[str, Any] | None = None,
+        timeout: float | None = None,
     ) -> None:
         """Initialize a raw Foundry Agent client.
 
@@ -211,6 +212,8 @@ class RawFoundryAgentChatClient(  # type: ignore[misc]
             compaction_strategy: Optional per-client compaction override.
             tokenizer: Optional tokenizer for compaction strategies.
             additional_properties: Additional properties stored on the client instance.
+            timeout: HTTP timeout in seconds for requests. When not provided, the
+                OpenAI SDK default is used (connect: 5s, total: 600s).
         """
         settings = load_settings(
             FoundryAgentSettings,
@@ -260,8 +263,11 @@ class RawFoundryAgentChatClient(  # type: ignore[misc]
             openai_client_kwargs["default_headers"] = dict(default_headers)
         if allow_preview:
             openai_client_kwargs["agent_name"] = self.agent_name
+        openai_client = self.project_client.get_openai_client(**openai_client_kwargs)
+        if timeout is not None:
+            openai_client = openai_client.with_options(timeout=timeout)
         super().__init__(
-            async_client=self.project_client.get_openai_client(**openai_client_kwargs),
+            async_client=openai_client,
             default_headers=default_headers,
             instruction_role=instruction_role,
             compaction_strategy=compaction_strategy,
@@ -537,6 +543,7 @@ class _FoundryAgentChatClient(  # type: ignore[misc]
         additional_properties: dict[str, Any] | None = None,
         middleware: (Sequence[ChatAndFunctionMiddlewareTypes] | None) = None,
         function_invocation_configuration: FunctionInvocationConfiguration | None = None,
+        timeout: float | None = None,
     ) -> None:
         """Initialize a Foundry Agent client with full middleware support.
 
@@ -556,6 +563,8 @@ class _FoundryAgentChatClient(  # type: ignore[misc]
             additional_properties: Additional properties stored on the client instance.
             middleware: Optional sequence of middleware.
             function_invocation_configuration: Optional function invocation configuration.
+            timeout: HTTP timeout in seconds for requests. When not provided, the
+                OpenAI SDK default is used (connect: 5s, total: 600s).
         """
         super().__init__(
             project_endpoint=project_endpoint,
@@ -573,6 +582,7 @@ class _FoundryAgentChatClient(  # type: ignore[misc]
             additional_properties=additional_properties,
             middleware=middleware,
             function_invocation_configuration=function_invocation_configuration,
+            timeout=timeout,
         )
 
 
@@ -625,6 +635,7 @@ class RawFoundryAgent(  # type: ignore[misc]
         compaction_strategy: CompactionStrategy | None = None,
         tokenizer: TokenizerProtocol | None = None,
         additional_properties: Mapping[str, Any] | None = None,
+        timeout: float | None = None,
     ) -> None:
         """Initialize a Foundry Agent.
 
@@ -657,6 +668,8 @@ class RawFoundryAgent(  # type: ignore[misc]
             compaction_strategy: Optional agent-level in-run compaction override.
             tokenizer: Optional agent-level tokenizer override.
             additional_properties: Additional properties stored on the local agent wrapper.
+            timeout: HTTP timeout in seconds for requests. When not provided, the
+                OpenAI SDK default is used (connect: 5s, total: 600s).
         """
         # Create the client
         actual_client_type = client_type or _FoundryAgentChatClient
@@ -675,6 +688,7 @@ class RawFoundryAgent(  # type: ignore[misc]
             "default_headers": default_headers,
             "env_file_path": env_file_path,
             "env_file_encoding": env_file_encoding,
+            "timeout": timeout,
         }
         if function_invocation_configuration is not None:
             if not issubclass(actual_client_type, FunctionInvocationLayer):
@@ -912,6 +926,7 @@ class FoundryAgent(  # type: ignore[misc]
         compaction_strategy: CompactionStrategy | None = None,
         tokenizer: TokenizerProtocol | None = None,
         additional_properties: Mapping[str, Any] | None = None,
+        timeout: float | None = None,
     ) -> None:
         """Initialize a Foundry Agent with full middleware and telemetry.
 
@@ -958,6 +973,8 @@ class FoundryAgent(  # type: ignore[misc]
             compaction_strategy: Optional agent-level in-run compaction override.
             tokenizer: Optional agent-level tokenizer override.
             additional_properties: Additional properties stored on the local agent wrapper.
+            timeout: HTTP timeout in seconds for requests. When not provided, the
+                OpenAI SDK default is used (connect: 5s, total: 600s).
         """
         super().__init__(
             project_endpoint=project_endpoint,
@@ -983,4 +1000,5 @@ class FoundryAgent(  # type: ignore[misc]
             compaction_strategy=compaction_strategy,
             tokenizer=tokenizer,
             additional_properties=additional_properties,
+            timeout=timeout,
         )

python/packages/foundry/pyproject.toml

@@ -4,7 +4,7 @@ description = "Microsoft Foundry integrations for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.7.0"
+version = "1.8.0"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,8 +23,8 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core>=1.7.0,<2",
-    "agent-framework-openai>=1.7.0,<2",
+    "agent-framework-core>=1.8.0,<2",
+    "agent-framework-openai>=1.8.0,<2",
     "azure-ai-inference>=1.0.0b9,<1.0.0b10",
     "azure-ai-projects>=2.1.0,<3.0",
 ]

python/packages/foundry/tests/foundry/test_foundry_agent.py

@@ -109,9 +109,67 @@ def test_raw_foundry_agent_chat_client_init_uses_explicit_parameters() -> None:
     assert "compaction_strategy" in signature.parameters
     assert "tokenizer" in signature.parameters
     assert "additional_properties" in signature.parameters
+    assert "timeout" in signature.parameters
     assert all(parameter.kind != inspect.Parameter.VAR_KEYWORD for parameter in signature.parameters.values())
 
 
+def test_raw_foundry_agent_chat_client_init_applies_timeout_to_openai_client() -> None:
+    """Test that timeout is applied via with_options without mutating the shared OpenAI client."""
+
+    mock_project = MagicMock()
+    openai_client_mock = MagicMock()
+    openai_client_mock.timeout = 5.0
+    mock_project.get_openai_client.return_value = openai_client_mock
+
+    client = RawFoundryAgentChatClient(
+        project_client=mock_project,
+        agent_name="test-agent",
+        timeout=60.0,
+    )
+
+    openai_client_mock.with_options.assert_called_once_with(timeout=60.0)
+    assert openai_client_mock.timeout == 5.0, "Original shared client must not be mutated"
+    assert client.client is openai_client_mock.with_options.return_value
+
+
+def test_raw_foundry_agent_chat_client_init_timeout_none_leaves_client_unchanged() -> None:
+    """Test that timeout=None does not call with_options and leaves the shared client intact."""
+
+    mock_project = MagicMock()
+    openai_client_mock = MagicMock()
+    openai_client_mock.timeout = 5.0
+    mock_project.get_openai_client.return_value = openai_client_mock
+
+    RawFoundryAgentChatClient(
+        project_client=mock_project,
+        agent_name="test-agent",
+        timeout=None,
+    )
+
+    openai_client_mock.with_options.assert_not_called()
+    assert openai_client_mock.timeout == 5.0
+
+
+def test_raw_foundry_agent_chat_client_init_applies_timeout_with_preview_enabled() -> None:
+    """Test that timeout uses with_options even when allow_preview=True (hosted agent path)."""
+
+    mock_project = MagicMock()
+    openai_client_mock = MagicMock()
+    openai_client_mock.timeout = 5.0
+    mock_project.get_openai_client.return_value = openai_client_mock
+
+    client = RawFoundryAgentChatClient(
+        project_client=mock_project,
+        agent_name="hosted-agent",
+        allow_preview=True,
+        timeout=120.0,
+    )
+
+    openai_client_mock.with_options.assert_called_once_with(timeout=120.0)
+    assert openai_client_mock.timeout == 5.0, "Original shared client must not be mutated"
+    assert client.client is openai_client_mock.with_options.return_value
+
+
 def test_raw_foundry_agent_chat_client_as_agent_preserves_client_type() -> None:
     """Test that as_agent() wraps the client in FoundryAgent using the same client class."""
 
@@ -552,9 +610,29 @@ def test_foundry_agent_chat_client_init_uses_explicit_parameters() -> None:
     assert "compaction_strategy" in signature.parameters
     assert "tokenizer" in signature.parameters
     assert "additional_properties" in signature.parameters
+    assert "timeout" in signature.parameters
     assert all(parameter.kind != inspect.Parameter.VAR_KEYWORD for parameter in signature.parameters.values())
 
 
+def test_foundry_agent_chat_client_init_propagates_timeout() -> None:
+    """Test that _FoundryAgentChatClient calls with_options instead of mutating the shared client."""
+
+    mock_project = MagicMock()
+    openai_client_mock = MagicMock()
+    openai_client_mock.timeout = 5.0
+    mock_project.get_openai_client.return_value = openai_client_mock
+
+    client = _FoundryAgentChatClient(
+        project_client=mock_project,
+        agent_name="test-agent",
+        timeout=45.0,
+    )
+
+    openai_client_mock.with_options.assert_called_once_with(timeout=45.0)
+    assert openai_client_mock.timeout == 5.0, "Original shared client must not be mutated"
+    assert client.client is openai_client_mock.with_options.return_value
+
+
 def test_raw_foundry_agent_init_creates_client() -> None:
     """Test that RawFoundryAgent creates a client internally."""
 
@@ -629,6 +707,7 @@ def test_raw_foundry_agent_init_uses_explicit_parameters() -> None:
     assert "compaction_strategy" in signature.parameters
     assert "tokenizer" in signature.parameters
     assert "additional_properties" in signature.parameters
+    assert "timeout" in signature.parameters
     assert all(parameter.kind != inspect.Parameter.VAR_KEYWORD for parameter in signature.parameters.values())
 
 
@@ -641,9 +720,47 @@ def test_foundry_agent_init_uses_explicit_parameters() -> None:
     assert "compaction_strategy" in signature.parameters
     assert "tokenizer" in signature.parameters
     assert "additional_properties" in signature.parameters
+    assert "timeout" in signature.parameters
     assert all(parameter.kind != inspect.Parameter.VAR_KEYWORD for parameter in signature.parameters.values())
 
 
+def test_foundry_agent_init_propagates_timeout_to_openai_client() -> None:
+    """Test that FoundryAgent uses with_options instead of mutating the shared OpenAI client."""
+
+    mock_project = MagicMock()
+    openai_client_mock = MagicMock()
+    openai_client_mock.timeout = 5.0
+    mock_project.get_openai_client.return_value = openai_client_mock
+
+    agent = FoundryAgent(
+        project_client=mock_project,
+        agent_name="test-agent",
+        timeout=90.0,
+    )
+
+    openai_client_mock.with_options.assert_called_once_with(timeout=90.0)
+    assert openai_client_mock.timeout == 5.0, "Original shared client must not be mutated"
+    assert agent.client.client is openai_client_mock.with_options.return_value
+
+
+def test_foundry_agent_init_timeout_none_leaves_client_default() -> None:
+    """Test that FoundryAgent with timeout=None does not call with_options or mutate the client."""
+
+    mock_project = MagicMock()
+    openai_client_mock = MagicMock()
+    openai_client_mock.timeout = 5.0
+    mock_project.get_openai_client.return_value = openai_client_mock
+
+    FoundryAgent(
+        project_client=mock_project,
+        agent_name="test-agent",
+        timeout=None,
+    )
+
+    openai_client_mock.with_options.assert_not_called()
+    assert openai_client_mock.timeout == 5.0
+
+
 def test_raw_foundry_agent_init_rejects_invalid_client_type() -> None:
     """Test that invalid client_type raises TypeError."""
 

python/packages/foundry_hosting/agent_framework_foundry_hosting/_responses.py

@@ -11,7 +11,7 @@ import tempfile
 import threading
 from collections.abc import AsyncIterable, AsyncIterator, Generator, Mapping, Sequence
 from contextlib import AbstractAsyncContextManager, AsyncExitStack, suppress
-from dataclasses import asdict, is_dataclass
+from dataclasses import asdict, dataclass, is_dataclass
 from pathlib import Path
 from typing import Protocol, cast
 
@@ -264,28 +264,73 @@ def _checkpoint_storage_for_context(root: str, context_id: str) -> FileCheckpoin
 
 # Foundry Toolbox Auth integration
 # Consent-URL error code returned by the Foundry MCP gateway when calling `/list`
-CONSENT_ERROR_CODE = -32007
+CONSENT_ERROR_CODE = -32006
 
 
-def consent_url_from_error(exc: BaseException) -> str | None:
-    """Return the consent URL when ``exc`` wraps a Foundry MCP gateway consent error.
+@dataclass
+class ConsentError:
+    name: str
+    consent_url: str
 
-    The Agent Framework MCP layer surfaces gateway consent failures by wrapping the underlying
-    ``McpError`` inside an :class:`AgentFrameworkException` (typically a ``ToolExecutionException``
-    raised from ``MCPStreamableHTTPTool.__aenter__``). This helper inspects ``exc.args`` for a
-    wrapped ``McpError`` whose ``error.code`` is :data:`CONSENT_ERROR_CODE`; when found, the
-    consent link the gateway returned in ``error.message`` is returned. Returns ``None`` for
-    anything else, so callers can do ``if (url := consent_url_from_error(ex)) is None: raise``.
+
+def consent_url_from_error(exc: BaseException) -> list[ConsentError] | None:
+    """Return the consent URLs when ``exc`` wraps Foundry MCP gateway consent errors.
 
     Args:
         exc: The exception to inspect.
 
     Returns:
-        The consent URL if ``exc`` wraps a consent ``McpError``, otherwise ``None``.
+        The consent URL(s) extracted from the error, or ``None`` if no consent error was found.
     """
     inner_exception = next((arg for arg in exc.args if isinstance(arg, McpError)), None)
     if inner_exception is not None and inner_exception.error.code == CONSENT_ERROR_CODE:
-        return inner_exception.error.message
+        # Parse the error message
+        # The error message is structured with the following format:
+        # "tools/list failed for 1 tool source(s), succeeded for 0 tool source(s) {"errors":[{"name": ..."
+        # where the second part is a JSON string that can be deserialized into an object with the following shape:
+        # ruff: disable[ERA001]
+        # {
+        #   "errors" : [
+        #       {
+        #           "name": "Name of the MCP tool that requires consent",
+        #           "type" : "mcp",
+        #           "error": {
+        #               "code": "CONSENT_REQUIRED",
+        #               "message": consent_url,
+        #           }
+        #       }
+        #   ]
+        # }
+        # ruff: enable[ERA001]
+        try:
+            consent_errors: list[ConsentError] = []
+            error_message_start = inner_exception.error.message.find("{")
+            if error_message_start == -1:
+                logger.warning("Consent error message does not contain JSON: %s", inner_exception.error.message)
+                return None
+            consent_details_json = inner_exception.error.message[error_message_start:]
+            consent_details = json.loads(consent_details_json)
+            if "errors" not in consent_details or not isinstance(consent_details["errors"], list):
+                logger.warning("Consent error message JSON does not contain 'errors' list: %s", consent_details_json)
+                return None
+            for error in consent_details["errors"]:
+                if (
+                    isinstance(error, dict)
+                    and error.get("type") == "mcp"  # type: ignore
+                    and "error" in error
+                    and isinstance(error["error"], dict)
+                    and error["error"].get("code") == "CONSENT_REQUIRED"  # type: ignore
+                    and "message" in error["error"]
+                ):
+                    consent_url = error["error"]["message"]  # type: ignore
+                    if isinstance(consent_url, str):
+                        consent_errors.append(ConsentError(name=error.get("name", "Unknown"), consent_url=consent_url))  # type: ignore
+                    else:
+                        logger.warning("Consent URL in error message is not a valid URL: %s", consent_url)  # type: ignore
+            if consent_errors:
+                return consent_errors
+        except json.JSONDecodeError:
+            logger.warning("Failed to parse consent details JSON: %s", inner_exception.error.message)
     return None
 
 
@@ -448,18 +493,19 @@ class ResponsesHostServer(ResponsesAgentServerHost):
         try:
             await self._ensure_agent_ready()
         except AgentFrameworkException as ex:
-            consent_url = consent_url_from_error(ex)
-            if consent_url is None:
+            consent_errors = consent_url_from_error(ex)
+            if consent_errors is None:
                 raise
-            logger.warning("OAuth consent required for Foundry MCP gateway.")
-            oauth_item = OAuthConsentRequestOutputItem(
-                id=IdGenerator.new_id("oacr"),
-                consent_link=consent_url,
-                server_label="Foundry Toolbox",
-            )
-            builder = response_event_stream.add_output_item(oauth_item.id)
-            yield builder.emit_added(oauth_item)
-            yield builder.emit_done(oauth_item)
+            for consent_error in consent_errors:
+                logger.warning("Consent URL for tool '%s': %s", consent_error.name, consent_error.consent_url)
+                oauth_item = OAuthConsentRequestOutputItem(
+                    id=IdGenerator.new_id("oacr"),
+                    consent_link=consent_error.consent_url,
+                    server_label=consent_error.name,
+                )
+                builder = response_event_stream.add_output_item(oauth_item.id)
+                yield builder.emit_added(oauth_item)
+                yield builder.emit_done(oauth_item)
             yield response_event_stream.emit_completed()
             return
 

python/packages/foundry_hosting/pyproject.toml

@@ -4,7 +4,7 @@ description = "Foundry Hosting integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0a260528"
+version = "1.0.0a260604"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,7 +23,7 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core>=1.7.0,<2",
+    "agent-framework-core>=1.8.0,<2",
     "azure-ai-agentserver-core>=2.0.0b3,<3",
     "azure-ai-agentserver-responses>=1.0.0b7,<2",
     "azure-ai-agentserver-invocations>=1.0.0b3,<2",

python/packages/foundry_hosting/tests/test_responses.py

@@ -39,6 +39,7 @@ from agent_framework_foundry_hosting import ResponsesHostServer
 from agent_framework_foundry_hosting._responses import (
     _AZURE_RESPONSES_MESSAGE_ROLE_TYPE,  # pyright: ignore[reportPrivateUsage]
     CONSENT_ERROR_CODE,
+    ConsentError,
     FileBasedFunctionApprovalStorage,  # pyright: ignore[reportPrivateUsage]
     InMemoryFunctionApprovalStorage,  # pyright: ignore[reportPrivateUsage]
     _item_to_message,  # pyright: ignore[reportPrivateUsage]
@@ -2118,15 +2119,11 @@ class TestMultiTurnMixedContent:
         assert resp2.json()["status"] == "completed"
 
         second_call_messages = agent.run.call_args_list[1].kwargs["messages"]
-        mcp_call_contents = [
-            c for m in second_call_messages for c in m.contents if c.type == "mcp_server_tool_call"
-        ]
+        mcp_call_contents = [c for m in second_call_messages for c in m.contents if c.type == "mcp_server_tool_call"]
         mcp_result_contents = [
             c for m in second_call_messages for c in m.contents if c.type == "mcp_server_tool_result"
         ]
-        function_result_contents = [
-            c for m in second_call_messages for c in m.contents if c.type == "function_result"
-        ]
+        function_result_contents = [c for m in second_call_messages for c in m.contents if c.type == "function_result"]
 
         assert len(mcp_call_contents) >= 1
         assert len(mcp_result_contents) >= 1
@@ -3264,7 +3261,10 @@ class TestCheckpointContextPathValidation:
 # region Agent lifecycle (lazy entry & OAuth consent surfacing)
 
 
-def _make_consent_error(url: str = "https://consent.example.com/auth") -> Exception:
+def _make_consent_error(
+    url: str = "https://consent.example.com/auth",
+    name: str = "Foundry Toolbox",
+) -> Exception:
     """Build an exception wrapping a Foundry MCP gateway consent error.
 
     Mirrors the real-world wrapping produced by ``MCPStreamableHTTPTool.__aenter__``,
@@ -3272,17 +3272,34 @@ def _make_consent_error(url: str = "https://consent.example.com/auth") -> Except
     ``ToolExecutionException`` (an ``AgentFrameworkException`` subclass) with the
     original error attached via ``inner_exception``. ``consent_url_from_error``
     then finds the wrapped ``McpError`` in ``exc.args``.
+
+    The McpError message uses the structured Foundry MCP gateway format:
+    a human-readable prefix followed by a JSON document describing each
+    failed tool source and its consent URL.
     """
     from agent_framework.exceptions import ToolExecutionException
 
-    inner = McpError(ErrorData(code=CONSENT_ERROR_CODE, message=url))
+    payload = json.dumps({
+        "errors": [
+            {
+                "name": name,
+                "type": "mcp",
+                "error": {
+                    "code": "CONSENT_REQUIRED",
+                    "message": url,
+                },
+            }
+        ]
+    })
+    message = f"tools/list failed for 1 tool source(s), succeeded for 0 tool source(s) {payload}"
+    inner = McpError(ErrorData(code=CONSENT_ERROR_CODE, message=message))
     return ToolExecutionException("MCP consent required", inner_exception=inner)
 
 
 class TestConsentUrlFromError:
     def test_returns_consent_url_when_inner_arg_is_consent_mcp_error(self) -> None:
-        exc = _make_consent_error("https://example.com/consent")
-        assert consent_url_from_error(exc) == "https://example.com/consent"
+        exc = _make_consent_error("https://example.com/consent", name="my-tool")
+        assert consent_url_from_error(exc) == [ConsentError(name="my-tool", consent_url="https://example.com/consent")]
 
     def test_returns_none_when_no_mcp_error_in_args(self) -> None:
         assert consent_url_from_error(Exception("boom")) is None
@@ -3299,6 +3316,13 @@ class TestConsentUrlFromError:
         bare = McpError(ErrorData(code=CONSENT_ERROR_CODE, message="https://x"))
         assert consent_url_from_error(bare) is None
 
+    def test_returns_none_when_message_has_no_json(self) -> None:
+        from agent_framework.exceptions import ToolExecutionException
+
+        inner = McpError(ErrorData(code=CONSENT_ERROR_CODE, message="no json here"))
+        exc = ToolExecutionException("MCP consent required", inner_exception=inner)
+        assert consent_url_from_error(exc) is None
+
 
 class TestAgentLifecycle:
     async def test_agent_entered_lazily_on_first_request(self) -> None:

python/packages/github_copilot/agent_framework_github_copilot/_agent.py

@@ -37,9 +37,10 @@ from agent_framework.exceptions import AgentException
 from agent_framework.observability import AgentTelemetryLayer
 
 try:
-    from copilot import CopilotClient, CopilotSession, SubprocessConfig
-    from copilot.generated.session_events import PermissionRequest, SessionEvent, SessionEventType
+    from copilot import CopilotClient, CopilotSession, RuntimeConnection
+    from copilot.generated.rpc import PermissionDecisionUserNotAvailable
     from copilot.session import MCPServerConfig, PermissionRequestResult, ProviderConfig, SystemMessageConfig
+    from copilot.session_events import PermissionRequest, SessionEvent, SessionEventType
     from copilot.tools import Tool as CopilotTool
     from copilot.tools import ToolInvocation, ToolResult
 except ImportError as _copilot_import_error:
@@ -57,8 +58,10 @@ else:
 DEFAULT_TIMEOUT_SECONDS: float = 60.0
 """Default timeout in seconds for Copilot requests."""
 
-PermissionHandlerType = Callable[[PermissionRequest, dict[str, str]], PermissionRequestResult]
-"""Type for permission request handlers."""
+PermissionHandlerType = Callable[
+    [PermissionRequest, dict[str, str]], "PermissionRequestResult | Awaitable[PermissionRequestResult]"
+]
+"""Type for permission request handlers. Supports both sync and async callbacks."""
 
 
 FunctionApprovalCallback = Callable[[Content], "bool | Awaitable[bool]"]
@@ -121,7 +124,7 @@ def _deny_all_permissions(
     _invocation: dict[str, str],
 ) -> PermissionRequestResult:
     """Default permission handler that denies all requests."""
-    return PermissionRequestResult()
+    return PermissionDecisionUserNotAvailable()
 
 
 class GitHubCopilotSettings(TypedDict, total=False):
@@ -140,9 +143,9 @@ class GitHubCopilotSettings(TypedDict, total=False):
             Can be set via environment variable GITHUB_COPILOT_TIMEOUT.
         log_level: CLI log level.
             Can be set via environment variable GITHUB_COPILOT_LOG_LEVEL.
-        copilot_home: Directory where the CLI stores session state, configuration,
+        base_directory: Directory where the CLI stores session state, configuration,
             and other persistent data. Can be set via environment variable
-            GITHUB_COPILOT_COPILOT_HOME. Defaults to ~/.copilot when not set.
+            GITHUB_COPILOT_BASE_DIRECTORY. Defaults to ~/.copilot when not set.
             Only applicable when the SDK spawns the CLI process (ignored when
             connecting to an external server via a pre-configured client).
     """
@@ -151,7 +154,7 @@ class GitHubCopilotSettings(TypedDict, total=False):
     model: str | None
     timeout: float | None
     log_level: str | None
-    copilot_home: str | None
+    base_directory: str | None
 
 
 class GitHubCopilotOptions(TypedDict, total=False):
@@ -314,7 +317,7 @@ class RawGitHubCopilotAgent(BaseAgent, Generic[OptionsT]):
         provider: ProviderConfig | None = opts.pop("provider", None)
         instruction_directories: list[str] | None = opts.pop("instruction_directories", None)
         on_function_approval: FunctionApprovalCallback | None = opts.pop("on_function_approval", None)
-        copilot_home = opts.pop("copilot_home", None)
+        base_directory = opts.pop("base_directory", None)
 
         self._settings = load_settings(
             GitHubCopilotSettings,
@@ -323,7 +326,7 @@ class RawGitHubCopilotAgent(BaseAgent, Generic[OptionsT]):
             model=model,
             timeout=timeout,
             log_level=log_level,
-            copilot_home=copilot_home,
+            base_directory=base_directory,
             env_file_path=env_file_path,
             env_file_encoding=env_file_encoding,
         )
@@ -362,14 +365,16 @@ class RawGitHubCopilotAgent(BaseAgent, Generic[OptionsT]):
         if self._client is None:
             cli_path = self._settings.get("cli_path") or None
             log_level = self._settings.get("log_level") or None
-            copilot_home = self._settings.get("copilot_home") or None
+            base_directory = self._settings.get("base_directory") or None
 
-            subprocess_kwargs: dict[str, Any] = {"cli_path": cli_path}
+            client_kwargs: dict[str, Any] = {}
+            if cli_path:
+                client_kwargs["connection"] = RuntimeConnection.for_stdio(path=cli_path)
             if log_level:
-                subprocess_kwargs["log_level"] = log_level
-            if copilot_home:
-                subprocess_kwargs["copilot_home"] = copilot_home
-            self._client = CopilotClient(SubprocessConfig(**subprocess_kwargs))
+                client_kwargs["log_level"] = log_level
+            if base_directory:
+                client_kwargs["base_directory"] = base_directory
+            self._client = CopilotClient(**client_kwargs)
 
         try:
             await self._client.start()

python/packages/github_copilot/pyproject.toml

@@ -4,7 +4,7 @@ description = "GitHub Copilot integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b260521"
+version = "1.0.0rc1"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,8 +23,8 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core>=1.6.0,<2",
-    "github-copilot-sdk>=1.0.0b2,<=1.0.0b2; python_version >= '3.11'",
+    "agent-framework-core>=1.8.0,<2",
+    "github-copilot-sdk>=1.0.0,<2; python_version >= '3.11'",
 ]
 
 [tool.uv]

python/packages/github_copilot/tests/test_github_copilot_agent.py

@@ -2,6 +2,7 @@
 
 # ruff: noqa: E402
 
+import os
 import unittest.mock
 from datetime import datetime, timezone
 from typing import Any
@@ -20,9 +21,11 @@ from agent_framework import (
     ContextProvider,
     HistoryProvider,
     Message,
+    tool,
 )
 from agent_framework.exceptions import AgentException
-from copilot.generated.session_events import (
+from copilot.session import PermissionHandler
+from copilot.session_events import (
     Data,
     SessionEvent,
     SessionEventType,
@@ -308,27 +311,27 @@ class TestGitHubCopilotAgentLifecycle:
             )
             await agent.start()
 
-            call_args = MockClient.call_args[0][0]
-            assert call_args.cli_path == "/custom/path"
-            assert call_args.log_level == "debug"
+            kwargs = MockClient.call_args.kwargs
+            assert kwargs["connection"].path == "/custom/path"
+            assert kwargs["log_level"] == "debug"
 
-    async def test_start_passes_copilot_home_to_subprocess_config(self) -> None:
-        """Test that copilot_home is passed through to SubprocessConfig."""
+    async def test_start_passes_base_directory_to_client(self) -> None:
+        """Test that base_directory is passed through to CopilotClient."""
         with patch("agent_framework_github_copilot._agent.CopilotClient") as MockClient:
             mock_client = MagicMock()
             mock_client.start = AsyncMock()
             MockClient.return_value = mock_client
 
             agent: GitHubCopilotAgent[GitHubCopilotOptions] = GitHubCopilotAgent(
-                default_options={"copilot_home": "/custom/copilot/home"}
+                default_options={"base_directory": "/custom/copilot/home"}
             )
             await agent.start()
 
-            call_args = MockClient.call_args[0][0]
-            assert call_args.copilot_home == "/custom/copilot/home"
+            kwargs = MockClient.call_args.kwargs
+            assert kwargs["base_directory"] == "/custom/copilot/home"
 
-    async def test_start_copilot_home_not_set_when_unspecified(self) -> None:
-        """Test that copilot_home is not included in SubprocessConfig when not specified."""
+    async def test_start_base_directory_not_set_when_unspecified(self) -> None:
+        """Test that base_directory is not included in client kwargs when not specified."""
         with patch("agent_framework_github_copilot._agent.CopilotClient") as MockClient:
             mock_client = MagicMock()
             mock_client.start = AsyncMock()
@@ -337,14 +340,14 @@ class TestGitHubCopilotAgentLifecycle:
             agent = GitHubCopilotAgent()
             await agent.start()
 
-            call_args = MockClient.call_args[0][0]
-            assert call_args.copilot_home is None
+            kwargs = MockClient.call_args.kwargs
+            assert "base_directory" not in kwargs
 
-    async def test_start_copilot_home_from_env_variable(self) -> None:
-        """Test that copilot_home can be set via GITHUB_COPILOT_COPILOT_HOME env variable."""
+    async def test_start_base_directory_from_env_variable(self) -> None:
+        """Test that base_directory can be set via GITHUB_COPILOT_BASE_DIRECTORY env variable."""
         with (
             patch("agent_framework_github_copilot._agent.CopilotClient") as MockClient,
-            patch.dict("os.environ", {"GITHUB_COPILOT_COPILOT_HOME": "/env/copilot/home"}),
+            patch.dict("os.environ", {"GITHUB_COPILOT_BASE_DIRECTORY": "/env/copilot/home"}),
         ):
             mock_client = MagicMock()
             mock_client.start = AsyncMock()
@@ -353,8 +356,8 @@ class TestGitHubCopilotAgentLifecycle:
             agent = GitHubCopilotAgent()
             await agent.start()
 
-            call_args = MockClient.call_args[0][0]
-            assert call_args.copilot_home == "/env/copilot/home"
+            kwargs = MockClient.call_args.kwargs
+            assert kwargs["base_directory"] == "/env/copilot/home"
 
 
 class TestGitHubCopilotAgentRun:
@@ -1053,11 +1056,11 @@ class TestGitHubCopilotAgentSessionManagement:
         mock_session: MagicMock,
     ) -> None:
         """Test that resumed session config includes tools and permission handler."""
-        from copilot.generated.session_events import PermissionRequest
-        from copilot.session import PermissionRequestResult
+        from copilot.session import PermissionDecisionApproveOnce, PermissionRequestResult
+        from copilot.session_events import PermissionRequest
 
         def my_handler(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
-            return PermissionRequestResult(kind="approved")
+            return PermissionDecisionApproveOnce()
 
         def my_tool(arg: str) -> str:
             """A test tool."""
@@ -1869,6 +1872,15 @@ class TestGitHubCopilotAgentErrorHandling:
 class TestGitHubCopilotAgentPermissions:
     """Test cases for permission handling."""
 
+    def test_deny_all_permissions_returns_user_not_available(self) -> None:
+        """Test that the default deny handler returns PermissionDecisionUserNotAvailable."""
+        from copilot.generated.rpc import PermissionDecisionUserNotAvailable
+
+        from agent_framework_github_copilot._agent import _deny_all_permissions
+
+        result = _deny_all_permissions(MagicMock(), {})
+        assert isinstance(result, PermissionDecisionUserNotAvailable)
+
     def test_no_permission_handler_when_not_provided(self) -> None:
         """Test that no handler is set when on_permission_request is not provided."""
         agent = GitHubCopilotAgent()
@@ -1876,13 +1888,14 @@ class TestGitHubCopilotAgentPermissions:
 
     def test_permission_handler_set_when_provided(self) -> None:
         """Test that a handler is set when on_permission_request is provided."""
-        from copilot.generated.session_events import PermissionRequest
-        from copilot.session import PermissionRequestResult
+        from copilot.generated.rpc import PermissionDecisionDeniedInteractivelyByUser
+        from copilot.session import PermissionDecisionApproveOnce, PermissionRequestResult
+        from copilot.session_events import PermissionRequest
 
         def approve_shell(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
             if request.kind == "shell":
-                return PermissionRequestResult(kind="approved")
-            return PermissionRequestResult(kind="denied-interactively-by-user")
+                return PermissionDecisionApproveOnce()
+            return PermissionDecisionDeniedInteractivelyByUser()
 
         agent: GitHubCopilotAgent[GitHubCopilotOptions] = GitHubCopilotAgent(
             default_options={"on_permission_request": approve_shell}
@@ -1895,13 +1908,14 @@ class TestGitHubCopilotAgentPermissions:
         mock_session: MagicMock,
     ) -> None:
         """Test that session config includes permission handler when provided."""
-        from copilot.generated.session_events import PermissionRequest
-        from copilot.session import PermissionRequestResult
+        from copilot.generated.rpc import PermissionDecisionDeniedInteractivelyByUser
+        from copilot.session import PermissionDecisionApproveOnce, PermissionRequestResult
+        from copilot.session_events import PermissionRequest
 
         def approve_shell_read(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
             if request.kind in ("shell", "read"):
-                return PermissionRequestResult(kind="approved")
-            return PermissionRequestResult(kind="denied-interactively-by-user")
+                return PermissionDecisionApproveOnce()
+            return PermissionDecisionDeniedInteractivelyByUser()
 
         agent: GitHubCopilotAgent[GitHubCopilotOptions] = GitHubCopilotAgent(
             client=mock_client,
@@ -2705,3 +2719,163 @@ class TestGitHubCopilotAgentContextProviders:
         assert call_kwargs.get("tools") is not None
         tool_names = [t.name for t in call_kwargs["tools"]]
         assert "load_skill" in tool_names
+
+
+# ---------------------------------------------------------------------------
+# Integration tests — require COPILOT_GITHUB_TOKEN env var
+# ---------------------------------------------------------------------------
+
+skip_if_copilot_integration_tests_disabled = pytest.mark.skipif(
+    os.getenv("COPILOT_GITHUB_TOKEN", "") == "",
+    reason="No COPILOT_GITHUB_TOKEN provided; skipping integration tests.",
+)
+
+
+@tool(approval_mode="never_require")
+def get_weather(location: str) -> str:
+    """Get the weather for a given location."""
+    return f"The weather in {location} is sunny with a high of 25C."
+
+
+@pytest.mark.flaky
+@pytest.mark.integration
+@skip_if_copilot_integration_tests_disabled
+async def test_integration_run_with_simple_prompt_returns_response() -> None:
+    """Integration test: basic non-streaming response."""
+    agent = GitHubCopilotAgent(
+        instructions="You are a helpful assistant. Keep your answers short.",
+        default_options={"on_permission_request": PermissionHandler.approve_all},
+    )
+
+    async with agent:
+        session = agent.create_session()
+        response = await agent.run("What is 2 + 2? Answer with just the number.", session=session)
+
+        assert response is not None
+        assert len(response.messages) > 0
+        assert "4" in response.text
+
+        if session.service_session_id and agent._client:
+            await agent._client.delete_session(session.service_session_id)
+
+
+@pytest.mark.flaky
+@pytest.mark.integration
+@skip_if_copilot_integration_tests_disabled
+async def test_integration_run_streaming_returns_updates() -> None:
+    """Integration test: streaming response yields updates."""
+    agent = GitHubCopilotAgent(
+        instructions="You are a helpful assistant. Keep your answers short.",
+        default_options={"on_permission_request": PermissionHandler.approve_all},
+    )
+
+    async with agent:
+        session = agent.create_session()
+        updates = []
+        async for chunk in agent.run("Count from 1 to 5.", stream=True, session=session):
+            updates.append(chunk)
+
+        assert len(updates) > 0
+        full_text = "".join(u.text for u in updates if u.text)
+        assert len(full_text) > 0
+
+        if session.service_session_id and agent._client:
+            await agent._client.delete_session(session.service_session_id)
+
+
+@pytest.mark.flaky
+@pytest.mark.integration
+@skip_if_copilot_integration_tests_disabled
+async def test_integration_run_with_function_tool_invokes_tool() -> None:
+    """Integration test: function tool is invoked by the agent."""
+    agent = GitHubCopilotAgent(
+        instructions="You are a helpful weather agent. Use the get_weather tool to answer weather questions.",
+        tools=[get_weather],
+        default_options={"on_permission_request": PermissionHandler.approve_all},
+    )
+
+    async with agent:
+        session = agent.create_session()
+        response = await agent.run("What's the weather like in Seattle?", session=session)
+
+        assert response is not None
+        assert len(response.messages) > 0
+        assert any(word in response.text.lower() for word in ["sunny", "25", "weather", "seattle"])
+
+        if session.service_session_id and agent._client:
+            await agent._client.delete_session(session.service_session_id)
+
+
+@pytest.mark.flaky
+@pytest.mark.integration
+@skip_if_copilot_integration_tests_disabled
+async def test_integration_run_with_session_maintains_context() -> None:
+    """Integration test: session maintains conversation context across turns."""
+    agent = GitHubCopilotAgent(
+        instructions="You are a helpful assistant. Keep your answers short.",
+        default_options={"on_permission_request": PermissionHandler.approve_all},
+    )
+
+    async with agent:
+        session = agent.create_session()
+
+        response1 = await agent.run("My name is Alice.", session=session)
+        assert response1 is not None
+
+        response2 = await agent.run("What is my name?", session=session)
+
+        assert response2 is not None
+        assert "alice" in response2.text.lower()
+
+        if session.service_session_id and agent._client:
+            await agent._client.delete_session(session.service_session_id)
+
+
+@pytest.mark.flaky
+@pytest.mark.integration
+@skip_if_copilot_integration_tests_disabled
+async def test_integration_run_with_session_resume_continues_conversation() -> None:
+    """Integration test: session can be resumed by ID."""
+    agent = GitHubCopilotAgent(
+        instructions="You are a helpful assistant. Keep your answers short.",
+        default_options={"on_permission_request": PermissionHandler.approve_all},
+    )
+
+    async with agent:
+        session1 = agent.create_session()
+        await agent.run("Remember this number: 42.", session=session1)
+
+        session_id = session1.service_session_id
+        assert session_id is not None
+
+        session2 = AgentSession()
+        session2.service_session_id = session_id
+
+        response = await agent.run("What number did I ask you to remember?", session=session2)
+
+        assert response is not None
+        assert "42" in response.text
+
+        if agent._client:
+            await agent._client.delete_session(session_id)
+
+
+@pytest.mark.flaky
+@pytest.mark.integration
+@skip_if_copilot_integration_tests_disabled
+async def test_integration_run_with_shell_permissions_executes_command() -> None:
+    """Integration test: shell commands can be executed with permission handler."""
+    agent = GitHubCopilotAgent(
+        instructions="You are a helpful assistant that can execute shell commands.",
+        default_options={"on_permission_request": PermissionHandler.approve_all},
+    )
+
+    async with agent:
+        session = agent.create_session()
+        response = await agent.run("Run a shell command to print 'hello world'", session=session)
+
+        assert response is not None
+        assert "hello" in response.text.lower()
+
+        if session.service_session_id and agent._client:
+            await agent._client.delete_session(session.service_session_id)

python/packages/mistral/pyproject.toml

@@ -4,7 +4,7 @@ description = "Mistral AI integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0a260505"
+version = "1.0.0a260604"
 license-files = ["LICENSE"]
 urls.homepage = "https://learn.microsoft.com/en-us/agent-framework/"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,7 +23,7 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core>=1.1.0,<2",
+    "agent-framework-core>=1.8.0,<2",
     "mistralai>=2.0.0,<3",
 ]
 

python/packages/openai/agent_framework_openai/_chat_client.py

@@ -385,6 +385,7 @@ class RawOpenAIChatClient(  # type: ignore[misc]
         additional_properties: dict[str, Any] | None = None,
         env_file_path: str | None = None,
         env_file_encoding: str | None = None,
+        timeout: float | None = None,
     ) -> None:
         """Initialize a raw OpenAI Chat client.
 
@@ -406,6 +407,7 @@ class RawOpenAIChatClient(  # type: ignore[misc]
             env_file_path: Optional ``.env`` file that is checked before the process environment
                 for ``OPENAI_*`` values.
             env_file_encoding: Encoding for the ``.env`` file.
+            timeout: Optional timeout in seconds for requests.
         """
         ...
 
@@ -427,6 +429,7 @@ class RawOpenAIChatClient(  # type: ignore[misc]
         additional_properties: dict[str, Any] | None = None,
         env_file_path: str | None = None,
         env_file_encoding: str | None = None,
+        timeout: float | None = None,
     ) -> None:
         """Initialize a raw OpenAI Chat client.
 
@@ -455,6 +458,7 @@ class RawOpenAIChatClient(  # type: ignore[misc]
             env_file_path: Optional ``.env`` file that is checked before process environment
                 variables for ``AZURE_OPENAI_*`` values.
             env_file_encoding: Encoding for the ``.env`` file.
+            timeout: Optional timeout in seconds for requests.
         """
         ...
 
@@ -476,6 +480,7 @@ class RawOpenAIChatClient(  # type: ignore[misc]
         additional_properties: dict[str, Any] | None = None,
         env_file_path: str | None = None,
         env_file_encoding: str | None = None,
+        timeout: float | None = None,
     ) -> None:
         """Initialize a raw OpenAI Chat client.
 
@@ -511,6 +516,8 @@ class RawOpenAIChatClient(  # type: ignore[misc]
                 variables. The same file is used for both ``OPENAI_*`` and ``AZURE_OPENAI_*``
                 lookups.
             env_file_encoding: Encoding for the ``.env`` file.
+            timeout: HTTP timeout in seconds for requests. When not provided, the
+                OpenAI SDK default is used (connect: 5s, total: 600s).
 
         Notes:
             Environment resolution and routing precedence are:
@@ -541,6 +548,7 @@ class RawOpenAIChatClient(  # type: ignore[misc]
             openai_model_fields=("chat_model", "model"),
             azure_model_fields=("chat_model", "model"),
             responses_mode=True,
+            timeout=timeout,
         )
 
         self.client = client
@@ -1454,10 +1462,21 @@ class RawOpenAIChatClient(  # type: ignore[misc]
         Returns:
             The prepared chat messages for a request.
         """
+        drops_reasoning_without_storage = not request_uses_service_side_storage and any(
+            content.type == "text_reasoning" for message in chat_messages for content in message.contents
+        )
+        drop_mcp_call_ids: set[str] = set()
+        if drops_reasoning_without_storage:
+            for message in chat_messages:
+                for content in message.contents:
+                    if content.type == "mcp_server_tool_call" and content.call_id:
+                        drop_mcp_call_ids.add(content.call_id)
+
         list_of_list = [
             self._prepare_message_for_openai(
                 message,
                 request_uses_service_side_storage=request_uses_service_side_storage,
+                drop_mcp_call_ids=drop_mcp_call_ids,
             )
             for message in chat_messages
         ]
@@ -1472,6 +1491,7 @@ class RawOpenAIChatClient(  # type: ignore[misc]
         message: Message,
         *,
         request_uses_service_side_storage: bool = True,
+        drop_mcp_call_ids: set[str] | None = None,
     ) -> list[dict[str, Any]]:
         """Prepare a chat message for the OpenAI Responses API format."""
         all_messages: list[dict[str, Any]] = []
@@ -1491,7 +1511,10 @@ class RawOpenAIChatClient(  # type: ignore[misc]
         # (replays_local_storage) still need stripping when the request also carries a continuation
         # marker, since the server-stored items would otherwise duplicate the inline ones. Without
         # storage, standalone reasoning items are invalid per the API ("reasoning was provided
-        # without its required following item"), so the reasoning branch always drops.
+        # without its required following item"), so the reasoning branch always drops. When that
+        # happens, `_prepare_messages_for_openai` also drops the paired hosted-MCP IDs across
+        # message boundaries rather than replaying bare MCP items.
+        drop_mcp_call_ids = drop_mcp_call_ids or set()
         for content in message.contents:
             match content.type:
                 case "text_reasoning":
@@ -1546,7 +1569,10 @@ class RawOpenAIChatClient(  # type: ignore[misc]
                     # server-side `id`, so under continuation it would duplicate
                     # the prior response's items (#3295). Drop the call here; the
                     # orphan result is dropped by the coalesce step that follows.
-                    if request_uses_service_side_storage:
+                    #
+                    # Without storage, a reasoning + hosted-MCP pair cannot be replayed
+                    # partially: reasoning is stripped above, and a bare mcp_call is rejected.
+                    if request_uses_service_side_storage or content.call_id in drop_mcp_call_ids:
                         continue
                     prepared_mcp = self._prepare_content_for_openai(
                         message.role,

python/packages/openai/agent_framework_openai/_shared.py

@@ -162,6 +162,7 @@ def load_openai_service_settings(
     openai_model_fields: Sequence[OpenAIModelSettingName] = ("model",),
     azure_model_fields: Sequence[OpenAIModelSettingName] = ("model",),
     responses_mode: bool = False,
+    timeout: float | None = None,
 ) -> tuple[dict[str, Any], AsyncOpenAI, bool]:
     """Load OpenAI settings, including Azure OpenAI model aliases.
 
@@ -218,6 +219,8 @@ def load_openai_service_settings(
             }
             if base_url := openai_settings.get("base_url"):
                 client_args["base_url"] = base_url
+            if timeout is not None:
+                client_args["timeout"] = timeout
             return openai_settings, AsyncOpenAI(**client_args), False  # type: ignore[return-value]
         checked_openai = True
     azure_settings = load_settings(
@@ -299,8 +302,12 @@ def load_openai_service_settings(
             openai_args["api_key"] = _ensure_async_token_provider(client_args["azure_ad_token_provider"])
         elif "api_key" in client_args:
             openai_args["api_key"] = client_args["api_key"]
+        if timeout is not None:
+            openai_args["timeout"] = timeout
         return azure_settings, AsyncOpenAI(**openai_args), True  # type: ignore[return-value]
 
+    if timeout is not None:
+        client_args["timeout"] = timeout
     return azure_settings, AsyncAzureOpenAI(**client_args), True  # type: ignore[return-value]
 
 

python/packages/openai/pyproject.toml

@@ -4,7 +4,7 @@ description = "OpenAI integrations for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.7.0"
+version = "1.8.0"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,7 +23,7 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core>=1.7.0,<2",
+    "agent-framework-core>=1.8.0,<2",
     "openai>=1.99.0,<3",
 ]
 

python/packages/openai/tests/openai/test_openai_chat_client.py

@@ -36,7 +36,7 @@ from agent_framework.exceptions import (
     ChatClientInvalidRequestException,
     SettingNotFoundError,
 )
-from openai import BadRequestError
+from openai import AsyncOpenAI, BadRequestError
 from openai.types.responses.response_reasoning_item import Summary
 from openai.types.responses.response_reasoning_summary_text_delta_event import (
     ResponseReasoningSummaryTextDeltaEvent,
@@ -55,7 +55,7 @@ from pydantic import BaseModel
 from pytest import param
 
 from agent_framework_openai import OpenAIChatClient
-from agent_framework_openai._chat_client import OPENAI_LOCAL_SHELL_CALL_ITEM_ID_KEY
+from agent_framework_openai._chat_client import OPENAI_LOCAL_SHELL_CALL_ITEM_ID_KEY, RawOpenAIChatClient
 from agent_framework_openai._exceptions import OpenAIContentFilterException
 
 skip_if_openai_integration_tests_disabled = pytest.mark.skipif(
@@ -194,6 +194,26 @@ def test_init_uses_explicit_parameters() -> None:
     assert all(parameter.kind != inspect.Parameter.VAR_KEYWORD for parameter in signature.parameters.values())
 
 
+def test_raw_openai_chat_client_init_uses_explicit_parameters() -> None:
+    signature = inspect.signature(RawOpenAIChatClient.__init__)
+
+    assert "additional_properties" in signature.parameters
+    assert "compaction_strategy" in signature.parameters
+    assert "tokenizer" in signature.parameters
+    assert "timeout" in signature.parameters
+    assert all(parameter.kind != inspect.Parameter.VAR_KEYWORD for parameter in signature.parameters.values())
+
+
+def test_raw_openai_chat_client_accepts_preconfigured_client_with_timeout() -> None:
+    """Test that timeout is accepted without error when async_client is pre-provided."""
+
+    mock_client = MagicMock(spec=AsyncOpenAI)
+    mock_client.timeout = 5.0
+
+    client = RawOpenAIChatClient(async_client=mock_client, timeout=30.0)
+    assert client is not None
+
+
 def test_openai_chat_client_supports_all_tool_protocols() -> None:
     assert isinstance(OpenAIChatClient, SupportsCodeInterpreterTool)
     assert isinstance(OpenAIChatClient, SupportsWebSearchTool)
@@ -5648,6 +5668,79 @@ def test_prepare_messages_for_openai_coalesces_mcp_call_and_result_into_single_i
     assert fco_items == [], f"unexpected orphan function_call_output items: {fco_items}"
 
 
+def test_prepare_messages_for_openai_drops_mcp_call_when_paired_reasoning_is_stripped() -> None:
+    client = OpenAIChatClient(model="test-model", api_key="test-key")
+
+    messages = [
+        Message(
+            role="assistant",
+            contents=[
+                Content.from_text_reasoning(id="rs_abc123", text="Need the MCP server."),
+                Content.from_mcp_server_tool_call(
+                    call_id="mcp_abc123",
+                    tool_name="search",
+                    server_name="api_specs",
+                    arguments='{"q": "cats"}',
+                ),
+            ],
+        ),
+        Message(
+            role="tool",
+            contents=[
+                Content.from_mcp_server_tool_result(
+                    call_id="mcp_abc123",
+                    output=[Content.from_text(text="found 10 cats")],
+                )
+            ],
+        ),
+    ]
+
+    result = client._prepare_messages_for_openai(messages, request_uses_service_side_storage=False)
+
+    types = [item.get("type") for item in result if isinstance(item, dict)]
+    assert "reasoning" not in types
+    assert "mcp_call" not in types
+    assert "function_call_output" not in types
+
+
+def test_prepare_messages_for_openai_drops_mcp_call_across_reasoning_messages() -> None:
+    client = OpenAIChatClient(model="test-model", api_key="test-key")
+
+    messages = [
+        Message(
+            role="assistant",
+            contents=[Content.from_text_reasoning(id="rs_abc123", text="Need a tool call.")],
+        ),
+        Message(
+            role="assistant",
+            contents=[
+                Content.from_mcp_server_tool_call(
+                    call_id="mcp_abc123",
+                    tool_name="search",
+                    server_name="api_specs",
+                    arguments='{"q": "cats"}',
+                )
+            ],
+        ),
+        Message(
+            role="tool",
+            contents=[
+                Content.from_mcp_server_tool_result(
+                    call_id="mcp_abc123",
+                    output=[Content.from_text(text="found 10 cats")],
+                )
+            ],
+        ),
+    ]
+
+    result = client._prepare_messages_for_openai(messages, request_uses_service_side_storage=False)
+
+    types = [item.get("type") for item in result if isinstance(item, dict)]
+    assert "reasoning" not in types
+    assert "mcp_call" not in types
+    assert "function_call_output" not in types
+
+
 def test_prepare_messages_for_openai_drops_orphan_mcp_server_tool_result() -> None:
     """When an mcp_server_tool_result has no matching mcp_server_tool_call in
     the message list, it must be dropped, NOT serialized as a

python/packages/orchestrations/agent_framework_orchestrations/_concurrent.py

@@ -19,7 +19,7 @@ from typing_extensions import Never
 
 from ._orchestration_request_info import AgentApprovalExecutor
 from ._participant_output_config import (
-    _MISSING,  # pyright: ignore[reportPrivateUsage]
+    UNSET,
     _coalesce_output_from,  # pyright: ignore[reportPrivateUsage]
     _coerce_intermediate_output_from,  # pyright: ignore[reportPrivateUsage]
     _ParticipantIntermediateOutputSelection,  # pyright: ignore[reportPrivateUsage]
@@ -213,7 +213,7 @@ class ConcurrentBuilder:
         *,
         participants: Sequence[SupportsAgentRun | Executor],
         checkpoint_storage: CheckpointStorage | None = None,
-        output_from: Sequence[_ParticipantOutputSpecifier] | Literal["all"] | None = cast(Any, _MISSING),
+        output_from: Sequence[_ParticipantOutputSpecifier] | Literal["all"] | None = cast(Any, UNSET),
         intermediate_output_from: _ParticipantIntermediateOutputSelection = None,
     ) -> None:
         """Initialize the ConcurrentBuilder.

python/packages/orchestrations/agent_framework_orchestrations/_group_chat.py

@@ -52,7 +52,7 @@ from ._base_group_chat_orchestrator import (
 from ._orchestration_request_info import AgentApprovalExecutor
 from ._orchestrator_helpers import clean_conversation_for_handoff
 from ._participant_output_config import (
-    _MISSING,  # pyright: ignore[reportPrivateUsage]
+    UNSET,
     _coalesce_output_from,  # pyright: ignore[reportPrivateUsage]
     _coerce_intermediate_output_from,  # pyright: ignore[reportPrivateUsage]
     _ParticipantIntermediateOutputSelection,  # pyright: ignore[reportPrivateUsage]
@@ -626,7 +626,7 @@ class GroupChatBuilder:
         termination_condition: TerminationCondition | None = None,
         max_rounds: int | None = None,
         checkpoint_storage: CheckpointStorage | None = None,
-        output_from: Sequence[_ParticipantOutputSpecifier] | Literal["all"] | None = cast(Any, _MISSING),
+        output_from: Sequence[_ParticipantOutputSpecifier] | Literal["all"] | None = cast(Any, UNSET),
         intermediate_output_from: _ParticipantIntermediateOutputSelection = None,
     ) -> None:
         """Initialize the GroupChatBuilder.

python/packages/orchestrations/agent_framework_orchestrations/_handoff.py

@@ -54,7 +54,7 @@ from agent_framework._workflows._workflow_context import WorkflowContext
 from ._base_group_chat_orchestrator import TerminationCondition
 from ._orchestrator_helpers import clean_conversation_for_handoff
 from ._participant_output_config import (
-    _MISSING,  # pyright: ignore[reportPrivateUsage]
+    UNSET,
     _coalesce_output_from,  # pyright: ignore[reportPrivateUsage]
     _coerce_intermediate_output_from,  # pyright: ignore[reportPrivateUsage]
     _ParticipantIntermediateOutputSelection,  # pyright: ignore[reportPrivateUsage]
@@ -597,7 +597,7 @@ class HandoffBuilder:
         description: str | None = None,
         checkpoint_storage: CheckpointStorage | None = None,
         termination_condition: TerminationCondition | None = None,
-        output_from: Sequence[_ParticipantOutputSpecifier] | Literal["all"] | None = cast(Any, _MISSING),
+        output_from: Sequence[_ParticipantOutputSpecifier] | Literal["all"] | None = cast(Any, UNSET),
         intermediate_output_from: _ParticipantIntermediateOutputSelection = None,
     ) -> None:
         r"""Initialize a HandoffBuilder for creating conversational handoff workflows.

python/packages/orchestrations/agent_framework_orchestrations/_magentic.py

@@ -28,7 +28,7 @@ from agent_framework._workflows._request_info_mixin import response_handler
 from agent_framework._workflows._workflow import Workflow
 from agent_framework._workflows._workflow_builder import WorkflowBuilder
 from agent_framework._workflows._workflow_context import WorkflowContext
-from typing_extensions import Never
+from typing_extensions import Never, Sentinel
 
 from ._base_group_chat_orchestrator import (
     BaseGroupChatOrchestrator,
@@ -39,7 +39,7 @@ from ._base_group_chat_orchestrator import (
     ParticipantRegistry,
 )
 from ._participant_output_config import (
-    _MISSING,  # pyright: ignore[reportPrivateUsage]
+    UNSET,
     _coalesce_output_from,  # pyright: ignore[reportPrivateUsage]
     _coerce_intermediate_output_from,  # pyright: ignore[reportPrivateUsage]
     _ParticipantIntermediateOutputSelection,  # pyright: ignore[reportPrivateUsage]
@@ -1411,13 +1411,13 @@ class MagenticBuilder:
         task_ledger_plan_update_prompt: str | None = None,
         progress_ledger_prompt: str | None = None,
         final_answer_prompt: str | None = None,
-        max_stall_count: int = 3,
+        max_stall_count: int | Sentinel = UNSET,
         max_reset_count: int | None = None,
         max_round_count: int | None = None,
         # Existing params
         enable_plan_review: bool = False,
         checkpoint_storage: CheckpointStorage | None = None,
-        output_from: Sequence[_ParticipantOutputSpecifier] | Literal["all"] | None = cast(Any, _MISSING),
+        output_from: Sequence[_ParticipantOutputSpecifier] | Literal["all"] | None = cast(Any, UNSET),
         intermediate_output_from: _ParticipantIntermediateOutputSelection = None,
     ) -> None:
         """Initialize the Magentic workflow builder.
@@ -1621,7 +1621,7 @@ class MagenticBuilder:
         progress_ledger_prompt: str | None = None,
         final_answer_prompt: str | None = None,
         # Limits
-        max_stall_count: int = 3,
+        max_stall_count: int | Sentinel = UNSET,
         max_reset_count: int | None = None,
         max_round_count: int | None = None,
     ) -> None:
@@ -1656,8 +1656,10 @@ class MagenticBuilder:
                 "Exactly one of manager, manager_agent, manager_factory, or manager_agent_factory must be provided."
             )
 
+        resolved_max_stall_count: int = 3 if max_stall_count is UNSET else cast(int, max_stall_count)
+
         def _log_warning_if_constructor_args_provided() -> None:
-            if any(
+            if max_stall_count is not UNSET or any(
                 arg is not None
                 for arg in [
                     task_ledger,
@@ -1668,7 +1670,6 @@ class MagenticBuilder:
                     task_ledger_plan_update_prompt,
                     progress_ledger_prompt,
                     final_answer_prompt,
-                    max_stall_count,
                     max_reset_count,
                     max_round_count,
                 ]
@@ -1689,7 +1690,7 @@ class MagenticBuilder:
                 task_ledger_plan_update_prompt=task_ledger_plan_update_prompt,
                 progress_ledger_prompt=progress_ledger_prompt,
                 final_answer_prompt=final_answer_prompt,
-                max_stall_count=max_stall_count,
+                max_stall_count=resolved_max_stall_count,
                 max_reset_count=max_reset_count,
                 max_round_count=max_round_count,
             )
@@ -1707,7 +1708,7 @@ class MagenticBuilder:
                 "task_ledger_plan_update_prompt": task_ledger_plan_update_prompt,
                 "progress_ledger_prompt": progress_ledger_prompt,
                 "final_answer_prompt": final_answer_prompt,
-                "max_stall_count": max_stall_count,
+                "max_stall_count": resolved_max_stall_count,
                 "max_reset_count": max_reset_count,
                 "max_round_count": max_round_count,
             }

python/packages/orchestrations/agent_framework_orchestrations/_participant_output_config.py

@@ -8,8 +8,9 @@ from typing import Any, Literal
 from agent_framework import SupportsAgentRun
 from agent_framework._workflows._agent_utils import resolve_agent_id
 from agent_framework._workflows._executor import Executor
+from typing_extensions import Sentinel
 
-_MISSING = object()
+UNSET = Sentinel("UNSET")
 _ALL_OUTPUTS: Literal["all"] = "all"
 _ALL_OTHER_OUTPUTS: Literal["all_other"] = "all_other"
 _ParticipantOutputSpecifier = str | SupportsAgentRun | Executor
@@ -20,10 +21,10 @@ _WorkflowExecutorSpecifier = Executor | SupportsAgentRun
 
 def _coalesce_output_from(  # pyright: ignore[reportUnusedFunction]
     *,
-    output_from: Any = _MISSING,
+    output_from: Any = UNSET,
 ) -> _ParticipantOutputSelection:
     """Resolve orchestration output selection to ``output_from``."""
-    if output_from is not _MISSING:
+    if output_from is not UNSET:
         return _coerce_output_from(output_from)
     return None
 

python/packages/orchestrations/agent_framework_orchestrations/_sequential.py

@@ -33,7 +33,7 @@ from agent_framework._workflows._workflow_context import WorkflowContext
 
 from ._orchestration_request_info import AgentApprovalExecutor
 from ._participant_output_config import (
-    _MISSING,  # pyright: ignore[reportPrivateUsage]
+    UNSET,
     _coalesce_output_from,  # pyright: ignore[reportPrivateUsage]
     _coerce_intermediate_output_from,  # pyright: ignore[reportPrivateUsage]
     _ParticipantIntermediateOutputSelection,  # pyright: ignore[reportPrivateUsage]
@@ -99,7 +99,7 @@ class SequentialBuilder:
         participants: Sequence[SupportsAgentRun | Executor],
         checkpoint_storage: CheckpointStorage | None = None,
         chain_only_agent_responses: bool = False,
-        output_from: Sequence[_ParticipantOutputSpecifier] | Literal["all"] | None = cast(Any, _MISSING),
+        output_from: Sequence[_ParticipantOutputSpecifier] | Literal["all"] | None = cast(Any, UNSET),
         intermediate_output_from: _ParticipantIntermediateOutputSelection = None,
     ) -> None:
         """Initialize the SequentialBuilder.

python/packages/orchestrations/pyproject.toml

@@ -4,7 +4,7 @@ description = "Orchestration patterns for Microsoft Agent Framework. Includes Se
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0rc2"
+version = "1.0.0rc3"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,7 +23,7 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core>=1.6.0,<2",
+    "agent-framework-core>=1.8.0,<2",
 ]
 
 [tool.uv]

python/packages/orchestrations/tests/test_magentic.py

@@ -1,5 +1,6 @@
 # Copyright (c) Microsoft. All rights reserved.
 
+import logging
 import sys
 from collections.abc import AsyncIterable, Awaitable, Sequence
 from dataclasses import dataclass
@@ -987,6 +988,33 @@ def test_magentic_builder_requires_exactly_one_manager_option():
         MagenticBuilder(participants=[agent], manager=manager, manager_factory=manager_factory)
 
 
+def test_magentic_with_custom_manager_does_not_warn_without_standard_manager_options(caplog: Any) -> None:
+    caplog.set_level(logging.WARNING, logger="agent_framework_orchestrations._magentic")
+
+    MagenticBuilder(participants=[StubAgent("agentA", "reply")], manager=FakeManager())
+
+    assert "Custom manager provided; all other manager arguments will be ignored." not in caplog.text
+
+
+def test_magentic_with_custom_manager_factory_does_not_warn_without_standard_manager_options(caplog: Any) -> None:
+    caplog.set_level(logging.WARNING, logger="agent_framework_orchestrations._magentic")
+
+    def manager_factory() -> MagenticManagerBase:
+        return FakeManager()
+
+    MagenticBuilder(participants=[StubAgent("agentA", "reply")], manager_factory=manager_factory)
+
+    assert "Custom manager provided; all other manager arguments will be ignored." not in caplog.text
+
+
+def test_magentic_with_custom_manager_warns_when_standard_manager_option_is_provided(caplog: Any) -> None:
+    caplog.set_level(logging.WARNING, logger="agent_framework_orchestrations._magentic")
+
+    MagenticBuilder(participants=[StubAgent("agentA", "reply")], manager=FakeManager(), max_stall_count=3)
+
+    assert "Custom manager provided; all other manager arguments will be ignored." in caplog.text
+
+
 async def test_magentic_with_manager_factory():
     """Test workflow creation using manager_factory."""
     factory_call_count = 0
@@ -1037,6 +1065,20 @@ async def test_magentic_with_agent_factory():
     assert event_count > 0
 
 
+def test_magentic_agent_factory_uses_default_max_stall_count() -> None:
+    def agent_factory() -> SupportsAgentRun:
+        return cast(SupportsAgentRun, StubManagerAgent())
+
+    participant = StubAgent("agentA", "reply from agentA")
+    workflow = MagenticBuilder(participants=[participant], manager_agent_factory=agent_factory).build()
+
+    orchestrator = next(e for e in workflow.executors.values() if isinstance(e, MagenticOrchestrator))
+    manager = orchestrator._manager  # type: ignore[reportPrivateUsage]
+
+    assert isinstance(manager, StandardMagenticManager)
+    assert manager.max_stall_count == 3
+
+
 async def test_magentic_manager_factory_reusable_builder():
     """Test that the builder can be reused to build multiple workflows with manager factory."""
     factory_call_count = 0

python/pyproject.toml

@@ -4,7 +4,7 @@ description = "Microsoft Agent Framework for building AI Agents with Python. Thi
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.7.0"
+version = "1.8.0"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,7 +23,7 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core[all]==1.7.0",
+    "agent-framework-core[all]==1.8.0",
 ]
 
 [dependency-groups]

python/samples/02-agents/compaction/README.md

@@ -5,7 +5,8 @@ This folder demonstrates context compaction patterns introduced by ADR-0019.
 ## Files
 
 - `basics.py` — builds a local message list and applies each built-in strategy one at a time.
-- `advanced.py` — composes multiple strategies with `TokenBudgetComposedStrategy`.
+- `summarization.py` — runs `SummarizationStrategy` directly with a real summarizing chat client.
+- `advanced.py` — composes multiple strategies with `TokenBudgetComposedStrategy`, including a real summarizer and tool-call groups.
 - `agent_client_overrides.py` — shows client defaults, agent-level overrides, and per-run compaction overrides.
 - `custom.py` — defines a custom strategy implementing the `CompactionStrategy` protocol.
 - `tiktoken_tokenizer.py` — shows a `TokenizerProtocol` implementation backed by `tiktoken`.
@@ -15,7 +16,8 @@ Run samples with:
 
 ```bash
 uv run samples/02-agents/compaction/basics.py
-uv run samples/02-agents/compaction/advanced.py
+uv run samples/02-agents/compaction/summarization.py  # requires OPENAI_API_KEY
+uv run samples/02-agents/compaction/advanced.py  # requires OPENAI_API_KEY
 uv run samples/02-agents/compaction/agent_client_overrides.py
 uv run samples/02-agents/compaction/custom.py
 uv run samples/02-agents/compaction/tiktoken_tokenizer.py

python/samples/02-agents/compaction/advanced.py

@@ -1,11 +1,14 @@
 # Copyright (c) Microsoft. All rights reserved.
 
 import asyncio
-from typing import Any
+from typing import Any, cast
 
 from agent_framework import (
+    GROUP_ANNOTATION_KEY,
+    GROUP_TOKEN_COUNT_KEY,
+    SUMMARY_OF_MESSAGE_IDS_KEY,
     CharacterEstimatorTokenizer,
-    ChatResponse,
+    Content,
     Message,
     SelectiveToolCallCompactionStrategy,
     SlidingWindowStrategy,
@@ -15,36 +18,48 @@ from agent_framework import (
     apply_compaction,
     included_token_count,
 )
+from agent_framework.openai import OpenAIChatClient
+from dotenv import load_dotenv
 
-"""This sample demonstrates composed in-run compaction with a token budget.
+load_dotenv()
+
+"""This sample demonstrates composed in-run compaction under a token budget.
+
+A long, tool-using conversation is compacted with a single
+``TokenBudgetComposedStrategy`` that runs three strategies in order until the
+included-token count fits the budget:
+
+1. ``SelectiveToolCallCompactionStrategy`` — drop older tool-call groups
+   (assistant ``function_call`` + ``tool`` result messages) that are expensive
+   and rarely needed verbatim once acted upon.
+2. ``SummarizationStrategy`` — use a *real* chat client to summarize the oldest
+   remaining turns into a single linked summary message.
+3. ``SlidingWindowStrategy`` — as a final guard, keep only the most recent
+   groups if the budget is still exceeded.
 
 Key components:
-- TokenBudgetComposedStrategy
-- Sequential strategy composition
-- Summarization with a SupportsChatGetResponse-compatible summarizer client
+- TokenBudgetComposedStrategy with ordered, escalating strategies
+- A real OpenAIChatClient used as the summarizer (not a stub)
+- Tool-call groups in the history so tool-call compaction is meaningful
+- Token accounting before/after via a TokenizerProtocol
+
+Run with:
+    uv run samples/02-agents/compaction/advanced.py  # requires OPENAI_API_KEY
 """
 
 
-class BudgetSummaryClient:
-    async def get_response(
-        self,
-        messages: list[Message],
-        *,
-        stream: bool = False,
-        options: dict[str, Any] | None = None,
-        **kwargs: Any,
-    ) -> ChatResponse:
-        summary_text = f"Budget summary generated from {len(messages)} prompt messages."
-        return ChatResponse(messages=[Message(role="assistant", contents=[summary_text])])
-
-
 def _build_long_history() -> list[Message]:
-    history = [Message(role="system", contents=["You are a migration copilot."])]
-    for i in range(1, 8):
+    """Build a long, tool-using migration conversation to create token pressure."""
+    history: list[Message] = [
+        Message(role="system", contents=["You are a migration copilot that plans and executes database migrations."]),
+    ]
+
+    # A few verbose planning turns to build up token pressure.
+    for i in range(1, 5):
         history.append(
             Message(
                 role="user",
-                contents=[f"Iteration {i}: capture migration requirements and edge cases."],
+                contents=[f"Iteration {i}: capture migration requirements, constraints, and edge cases in detail."],
             )
         )
         history.append(
@@ -52,17 +67,62 @@ def _build_long_history() -> list[Message]:
                 role="assistant",
                 contents=[
                     (
-                        f"Iteration {i}: detailed plan with dependencies, rollback guidance, and testing details. "
-                        "This sentence is intentionally long to create token pressure."
+                        f"Iteration {i}: produced a detailed plan covering dependencies, rollback guidance, data "
+                        "backfill, and a full testing matrix. This response is intentionally verbose to add pressure."
                     )
                 ],
             )
         )
+
+    # A tool-call group: the assistant inspects the schema via a tool.
+    history.append(
+        Message(
+            role="assistant",
+            contents=[Content.from_function_call(call_id="call_1", name="inspect_schema", arguments='{"db":"legacy"}')],
+        )
+    )
+    history.append(
+        Message(
+            role="tool",
+            contents=[Content.from_function_result(call_id="call_1", result="tables: users, orders, invoices, events")],
+        )
+    )
+    history.append(Message(role="assistant", contents=["Schema inspection found four core tables to migrate."]))
+
+    # The most recent turn — this should survive compaction verbatim.
+    history.append(Message(role="user", contents=["What is the safest order to migrate these tables?"]))
+    history.append(
+        Message(
+            role="assistant",
+            contents=["Migrate reference tables (users) first, then orders, then invoices, and events last."],
+        )
+    )
     return history
 
 
+def _annotation(message: Message) -> dict[str, Any] | None:
+    annotation = message.additional_properties.get(GROUP_ANNOTATION_KEY)
+    return cast("dict[str, Any]", annotation) if isinstance(annotation, dict) else None
+
+
+def _token_count(message: Message) -> int | None:
+    annotation = _annotation(message)
+    return annotation.get(GROUP_TOKEN_COUNT_KEY) if annotation else None
+
+
+def _relation(message: Message) -> str:
+    """Describe how a projected message relates to the original messages."""
+    annotation = _annotation(message)
+    if annotation is None:
+        return ""
+    summarizes = annotation.get(SUMMARY_OF_MESSAGE_IDS_KEY)
+    if summarizes:
+        return f" <- summary of {summarizes}"
+    return ""
+
+
 async def main() -> None:
-    # 1. Build synthetic history representing long-running in-run growth.
+    # 1. Build synthetic history representing long-running, tool-using growth.
     messages = _build_long_history()
 
     # 2. Configure tokenizer and measure token count before compaction.
@@ -70,22 +130,35 @@ async def main() -> None:
     annotate_message_groups(messages, tokenizer=tokenizer)
     budget_before = included_token_count(messages)
 
-    # 3. Configure composed strategy stack.
+    print("Before compaction message set:")
+    for msg in messages:
+        text_preview = msg.text[:80] if msg.text else "<non-text>"
+        print(f"- [{msg.role}] {text_preview} ({msg.message_id}, {_token_count(msg)} tokens)")
+    print()
+
+    # 3. Create a real summarizer client. SummarizationStrategy only requires a
+    #    SupportsChatGetResponse-compatible client.
+    summarizer = OpenAIChatClient(model="gpt-4o-mini")
+
+    # 4. Configure the composed strategy stack. Strategies run in order and the
+    #    composed strategy stops as soon as the included-token budget is met.
+    #    The budget is set high enough that the generated summary fits within it:
+    #    a tighter budget would trip the composed fallback, which excludes the
+    #    oldest group first (the summary) once the included set exceeds the
+    #    budget. SlidingWindowStrategy remains as a recency safety net for longer
+    #    histories; for this sample summarization alone reaches budget, so the
+    #    window does not need to fire.
     composed = TokenBudgetComposedStrategy(
-        token_budget=200,
+        token_budget=400,
         tokenizer=tokenizer,
         strategies=[
             SelectiveToolCallCompactionStrategy(keep_last_tool_call_groups=0),
-            SummarizationStrategy(
-                client=BudgetSummaryClient(),
-                target_count=3,
-                threshold=3,
-            ),
+            SummarizationStrategy(client=summarizer, target_count=3, threshold=2),
             SlidingWindowStrategy(keep_last_groups=4),
         ],
     )
 
-    # 4. Apply compaction and inspect the budget result.
+    # 5. Apply compaction and inspect the budget result.
     projected = await apply_compaction(messages, strategy=composed, tokenizer=tokenizer)
     budget_after = included_token_count(messages)
 
@@ -95,23 +168,44 @@ async def main() -> None:
     print("Projected roles:", [m.role for m in projected])
     print("Projected messages with token counts:")
     for msg in projected:
-        group = msg.additional_properties.get("_group")
-        token_count = group.get("token_count") if isinstance(group, dict) else None
         text_preview = msg.text[:80] if msg.text else "<non-text>"
-        print(f"- [{msg.role}] {text_preview} ({token_count} tokens)")
+        print(f"- [{msg.role}] {text_preview} ({msg.message_id}, {_token_count(msg)} tokens){_relation(msg)}")
+
+    # 6. Surface the model-generated summary, if summarization fired.
+    for msg in messages:
+        annotation = _annotation(msg)
+        if annotation and annotation.get(SUMMARY_OF_MESSAGE_IDS_KEY):
+            print("\nGenerated summary:")
+            print(f"  {msg.text}")
+            print(f"  summarizes: {annotation.get(SUMMARY_OF_MESSAGE_IDS_KEY)}")
 
 
 if __name__ == "__main__":
     asyncio.run(main())
 
 """
-Sample output:
-Projected messages after compaction: 3
-Included token count before compaction: 793
-Included token count after compaction: 144
-Projected roles: ['system', 'user', 'assistant']
+Sample output (summary text and token counts vary because the summary is generated by the model):
+
+Before compaction message set:
+- [system] You are a migration copilot that plans and executes database migrations. (msg_0, 46 tokens)
+- [user] Iteration 1: capture migration requirements, constraints, and edge cases in deta (msg_1, 48 tokens)
+- [assistant] Iteration 1: produced a detailed plan covering dependencies, rollback guidance,  (msg_2, 73 tokens)
+...
+- [user] What is the safest order to migrate these tables? (msg_12, 40 tokens)
+- [assistant] Migrate reference tables (users) first, then orders, then invoices, and events l (msg_13, 50 tokens)
+
+Projected messages after compaction: 5
+Included token count before compaction: 757
+Included token count after compaction: 274
+Projected roles: ['system', 'assistant', 'assistant', 'user', 'assistant']
 Projected messages with token counts:
-- [system] You are a migration copilot. (35 tokens)
-- [user] Iteration 7: capture migration requirements and edge cases. (43 tokens)
-- [assistant] Iteration 7: detailed plan with dependencies, rollback guidance, and testing det (66 tokens)
+- [system] You are a migration copilot that plans and executes database migrations. (msg_0, 46 tokens)
+- [assistant] Across four planning turns the user and assistant... (summary_14, 96 tokens) <- summary of [msg_1..8]
+- [assistant] Schema inspection found four core tables to migrate. (msg_11, 42 tokens)
+- [user] What is the safest order to migrate these tables? (msg_12, 40 tokens)
+- [assistant] Migrate reference tables (users) first, then orders, then invoices, and events l (msg_13, 50 tokens)
+
+Generated summary:
+  Across four planning turns the user and assistant defined the migration requirements...
+  summarizes: ['msg_1', 'msg_2', 'msg_3', 'msg_4', 'msg_5', 'msg_6', 'msg_7', 'msg_8']
 """

python/samples/02-agents/compaction/summarization.py

@@ -0,0 +1,159 @@
+# Copyright (c) Microsoft. All rights reserved.
+
+import asyncio
+from typing import Any, cast
+
+from agent_framework import (
+    GROUP_ANNOTATION_KEY,
+    SUMMARIZED_BY_SUMMARY_ID_KEY,
+    SUMMARY_OF_MESSAGE_IDS_KEY,
+    Message,
+    SummarizationStrategy,
+    apply_compaction,
+)
+from agent_framework.openai import OpenAIChatClient
+from dotenv import load_dotenv
+
+load_dotenv()
+
+"""This sample demonstrates the SummarizationStrategy directly.
+
+Unlike SlidingWindow/Truncation strategies that simply drop older groups,
+``SummarizationStrategy`` calls a real chat client to *summarize* the oldest
+message groups, replaces them with a single linked summary message, and keeps
+the most recent turns verbatim. This preserves long-range context (decisions,
+goals, unresolved items) while bounding the prompt size.
+
+Key components:
+- SummarizationStrategy with a real OpenAIChatClient summarizer
+- ``apply_compaction`` to run the strategy over a message list
+- Bidirectional summary trace metadata (summary -> originals, original -> summary)
+
+Run with:
+    uv run samples/02-agents/compaction/summarization.py  # requires OPENAI_API_KEY
+"""
+
+
+def _annotation(message: Message) -> dict[str, Any] | None:
+    annotation = message.additional_properties.get(GROUP_ANNOTATION_KEY)
+    return cast("dict[str, Any]", annotation) if isinstance(annotation, dict) else None
+
+
+def _build_history() -> list[Message]:
+    """Build a multi-turn conversation long enough to trigger summarization."""
+    return [
+        Message(role="system", contents=["You are a project planning assistant."]),
+        Message(role="user", contents=["We are migrating a monolith to microservices. Where do we start?"]),
+        Message(
+            role="assistant",
+            contents=["Start by mapping bounded contexts and identifying the highest-churn modules to extract first."],
+        ),
+        Message(role="user", contents=["The billing module changes most often. What are the risks of extracting it?"]),
+        Message(
+            role="assistant",
+            contents=["Main risks: distributed transactions, invoices-table ownership, and latency on hot paths."],
+        ),
+        Message(role="user", contents=["How should we handle the shared invoices table?"]),
+        Message(
+            role="assistant",
+            contents=["Use the strangler-fig pattern: dual-write during transition, then make billing the owner."],
+        ),
+        Message(role="user", contents=["What is the most recent decision we made?"]),
+        Message(role="assistant", contents=["We decided to extract billing first using the strangler-fig pattern."]),
+    ]
+
+
+def _print_messages(label: str, messages: list[Message]) -> None:
+    print(f"\n--- {label} ---")
+    print(f"Message count: {len(messages)}")
+    for index, message in enumerate(messages, start=1):
+        text = message.text or ", ".join(content.type for content in message.contents)
+        print(f"{index:02d}. [{message.role}] {text[:90]}")
+
+
+async def main() -> None:
+    # 1. Create a real summarizing client. SummarizationStrategy only requires a
+    #    SupportsChatGetResponse-compatible client, so any chat client works.
+    summarizer = OpenAIChatClient(model="gpt-4o-mini")
+
+    # 2. Build a conversation and show it before compaction.
+    messages = _build_history()
+    _print_messages("Before compaction", messages)
+
+    # 3. Configure the strategy. It triggers once the included non-system message
+    #    count exceeds ``target_count + threshold`` (here 4 + 2 = 6), summarizing
+    #    the oldest groups down toward ``target_count`` while keeping recent turns.
+    strategy = SummarizationStrategy(
+        client=summarizer,
+        target_count=4,
+        threshold=2,
+    )
+
+    # 4. Apply the strategy. The oldest groups are summarized into a single
+    #    assistant message; the projected list is what the model would receive.
+    projected = await apply_compaction(messages, strategy=strategy)
+    _print_messages("After compaction (SummarizationStrategy)", projected)
+
+    # 5. Inspect the generated summary and its bidirectional trace metadata.
+    print("\n--- Summary trace ---")
+    for message in messages:
+        annotation = _annotation(message)
+        if annotation is None:
+            continue
+        summarizes = annotation.get(SUMMARY_OF_MESSAGE_IDS_KEY)
+        if summarizes:
+            print(f"Generated summary ({message.message_id}):")
+            print(f"  {message.text}")
+            print(f"  summarizes original ids: {summarizes}")
+    summarized_by: dict[str | None, Any] = {}
+    for message in messages:
+        annotation = _annotation(message)
+        if annotation is None:
+            continue
+        summary_id = annotation.get(SUMMARIZED_BY_SUMMARY_ID_KEY)
+        if summary_id:
+            summarized_by[message.message_id] = summary_id
+    if summarized_by:
+        print("Originals replaced by the summary:")
+        for original_id, summary_id in summarized_by.items():
+            print(f"  {original_id} -> {summary_id}")
+
+
+if __name__ == "__main__":
+    asyncio.run(main())
+
+"""
+Sample output (summary text varies because it is generated by the model):
+
+--- Before compaction ---
+Message count: 9
+01. [system] You are a project planning assistant.
+02. [user] We are migrating a monolith to microservices. Where do we start?
+03. [assistant] Start by mapping bounded contexts and identifying the highest-churn modules to ex
+04. [user] The billing module changes most often. What are the risks of extracting it?
+05. [assistant] Main risks: distributed transactions, data ownership of the invoices table, and lat
+06. [user] How should we handle the shared invoices table?
+07. [assistant] Use the strangler-fig pattern: dual-write during transition, then make billing the
+08. [user] What is the most recent decision we made?
+09. [assistant] We decided to extract billing first using the strangler-fig pattern.
+
+--- After compaction (SummarizationStrategy) ---
+Message count: 6
+01. [system] You are a project planning assistant.
+02. [assistant] The user is migrating a monolith to microservices and decided to extract the billin
+03. [user] How should we handle the shared invoices table?
+04. [assistant] Use the strangler-fig pattern: dual-write during transition, then make billing the
+05. [user] What is the most recent decision we made?
+06. [assistant] We decided to extract billing first using the strangler-fig pattern.
+
+--- Summary trace ---
+Generated summary (summary_9):
+  The user is migrating a monolith to microservices and decided to extract the billing module first...
+  summarizes original ids: ['msg_1', 'msg_2', 'msg_3', 'msg_4', 'msg_5']
+Originals replaced by the summary:
+  msg_1 -> summary_9
+  msg_2 -> summary_9
+  msg_3 -> summary_9
+  msg_4 -> summary_9
+  msg_5 -> summary_9
+"""

python/samples/02-agents/providers/github_copilot/README.md

@@ -23,7 +23,7 @@ The following environment variables can be configured:
 | `GITHUB_COPILOT_MODEL` | Model to use (e.g., "gpt-5", "claude-sonnet-4") | Server default |
 | `GITHUB_COPILOT_TIMEOUT` | Request timeout in seconds | `60` |
 | `GITHUB_COPILOT_LOG_LEVEL` | CLI log level | `info` |
-| `GITHUB_COPILOT_COPILOT_HOME` | Directory for CLI session state and config | `~/.copilot` |
+| `GITHUB_COPILOT_BASE_DIRECTORY` | Directory for CLI session state and config | `~/.copilot` |
 
 ## Observability
 

python/samples/02-agents/providers/github_copilot/github_copilot_basic.py

@@ -19,8 +19,7 @@ from typing import Annotated
 
 from agent_framework import tool
 from agent_framework.github import GitHubCopilotAgent
-from copilot.generated.session_events import PermissionRequest
-from copilot.session import PermissionRequestResult
+from copilot.session import PermissionHandler
 from dotenv import load_dotenv
 from pydantic import Field
 
@@ -28,19 +27,6 @@ from pydantic import Field
 load_dotenv()
 
 
-def prompt_permission(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
-    """Permission handler that prompts the user for approval."""
-    print(f"\n[Permission Request: {request.kind}]")
-
-    if request.full_command_text is not None:
-        print(f"  Command: {request.full_command_text}")
-
-    response = input("Approve? (y/n): ").strip().lower()
-    if response in ("y", "yes"):
-        return PermissionRequestResult(kind="approved")
-    return PermissionRequestResult(kind="denied-interactively-by-user")
-
-
 # NOTE: approval_mode="never_require" is for sample brevity. Use "always_require" in production;
 # see samples/02-agents/tools/function_tool_with_approval.py
 # and samples/02-agents/tools/function_tool_with_approval_and_sessions.py.
@@ -60,7 +46,7 @@ async def non_streaming_example() -> None:
     agent = GitHubCopilotAgent(
         instructions="You are a helpful weather agent.",
         tools=[get_weather],
-        default_options={"on_permission_request": prompt_permission},
+        default_options={"on_permission_request": PermissionHandler.approve_all},
     )
 
     async with agent:
@@ -77,7 +63,7 @@ async def streaming_example() -> None:
     agent = GitHubCopilotAgent(
         instructions="You are a helpful weather agent.",
         tools=[get_weather],
-        default_options={"on_permission_request": prompt_permission},
+        default_options={"on_permission_request": PermissionHandler.approve_all},
     )
 
     async with agent:
@@ -97,7 +83,7 @@ async def runtime_options_example() -> None:
     agent = GitHubCopilotAgent(
         instructions="Always respond in exactly 3 words.",
         tools=[get_weather],
-        default_options={"on_permission_request": prompt_permission},
+        default_options={"on_permission_request": PermissionHandler.approve_all},
     )
 
     async with agent:

python/samples/02-agents/providers/github_copilot/github_copilot_with_file_operations.py

@@ -4,8 +4,7 @@
 GitHub Copilot Agent with File Operation Permissions
 
 This sample demonstrates how to enable file read and write operations with GitHubCopilotAgent.
-By providing a permission handler that approves "read" and/or "write" requests, the agent can
-read from and write to files on the filesystem.
+By providing a permission handler, the agent can read from and write to files on the filesystem.
 
 SECURITY NOTE: Only enable file permissions when you trust the agent's actions.
 - "read" allows the agent to read any accessible file
@@ -15,21 +14,18 @@ SECURITY NOTE: Only enable file permissions when you trust the agent's actions.
 import asyncio
 
 from agent_framework.github import GitHubCopilotAgent
-from copilot.generated.session_events import PermissionRequest
-from copilot.session import PermissionRequestResult
+from copilot.generated.rpc import PermissionDecisionDeniedInteractivelyByUser
+from copilot.session import PermissionHandler, PermissionRequestResult
+from copilot.session_events import PermissionRequest
 
 
-def prompt_permission(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
+async def prompt_permission(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
     """Permission handler that prompts the user for approval."""
     print(f"\n[Permission Request: {request.kind}]")
-
-    if request.path is not None:
-        print(f"  Path: {request.path}")
-
-    response = input("Approve? (y/n): ").strip().lower()
+    response = (await asyncio.to_thread(input, "Approve? (y/n): ")).strip().lower()
     if response in ("y", "yes"):
-        return PermissionRequestResult(kind="approved")
-    return PermissionRequestResult(kind="denied-interactively-by-user")
+        return PermissionHandler.approve_all(request, context)
+    return PermissionDecisionDeniedInteractivelyByUser()
 
 
 async def main() -> None:

python/samples/02-agents/providers/github_copilot/github_copilot_with_function_approval.py

@@ -32,6 +32,7 @@ from typing import Annotated
 
 from agent_framework import Content, tool
 from agent_framework.github import GitHubCopilotAgent
+from copilot.session import PermissionHandler
 from dotenv import load_dotenv
 
 load_dotenv()
@@ -48,37 +49,42 @@ def get_weather_detail(location: Annotated[str, "The city and state, e.g. San Fr
     )
 
 
-def prompt_for_approval(call: Content) -> bool:
-    """Synchronous approval prompt.
+async def prompt_for_approval(call: Content) -> bool:
+    """Async approval callback that prompts the user interactively.
 
     The callback receives a ``FunctionCallContent`` so the operator can review
     the tool name and arguments before deciding. Returning ``True`` allows the
     call; returning ``False`` denies it and a tool-error is returned to the
     model.
+
+    Uses ``asyncio.to_thread`` so the event loop is not blocked by ``input()``.
     """
-    print(f"\n[Function Approval Request]\n  Tool: {call.name}\n  Arguments: {call.arguments}")
-    response = input("Approve this tool call? (y/n): ").strip().lower()
+    print(f"\n  [Function Approval Request]\n  Tool: {call.name}\n  Arguments: {call.arguments}")
+    response = (await asyncio.to_thread(input, "  Approve this tool call? (y/n): ")).strip().lower()
     return response in ("y", "yes")
 
 
-async def prompt_for_approval_async(call: Content) -> bool:
-    """Async approval prompt.
+def auto_approve(call: Content) -> bool:
+    """Synchronous approval callback that always approves.
 
-    Use an async callback when approval requires I/O (e.g. an HTTP call to a
-    review service or queueing the request to a UI). ``input()`` is wrapped
-    with ``asyncio.to_thread`` so the event loop is not blocked.
+    Use a sync callback for simple, non-blocking decisions that don't require
+    I/O (e.g. checking an allow-list of tool names).
     """
-    print(f"\n[Function Approval Request - async]\n  Tool: {call.name}\n  Arguments: {call.arguments}")
-    response = await asyncio.to_thread(input, "Approve this tool call? (y/n): ")
-    return response.strip().lower() in ("y", "yes")
+    print(f"\n  [Function Approval Request]\n  Tool: {call.name}\n  Arguments: {call.arguments}")
+    print("  -> Auto-approved")
+    return True
 
 
-async def run_with_sync_callback() -> None:
-    print("\n=== GitHub Copilot Agent: synchronous approval callback ===")
+async def run_with_interactive_callback() -> None:
+    """Demonstrates an interactive approval prompt before tool execution."""
+    print("\n=== GitHub Copilot Agent: interactive approval callback ===")
     agent = GitHubCopilotAgent(
         instructions="You are a helpful weather assistant.",
         tools=[get_weather_detail],
-        default_options={"on_function_approval": prompt_for_approval},
+        default_options={
+            "on_function_approval": prompt_for_approval,
+            "on_permission_request": PermissionHandler.approve_all,
+        },
     )
     async with agent:
         query = "Give me the detailed weather for Seattle."
@@ -87,12 +93,16 @@ async def run_with_sync_callback() -> None:
         print(f"Agent: {result}")
 
 
-async def run_with_async_callback() -> None:
-    print("\n=== GitHub Copilot Agent: asynchronous approval callback ===")
+async def run_with_auto_approve_callback() -> None:
+    """Demonstrates a synchronous callback that always approves."""
+    print("\n=== GitHub Copilot Agent: synchronous auto-approve callback ===")
     agent = GitHubCopilotAgent(
         instructions="You are a helpful weather assistant.",
         tools=[get_weather_detail],
-        default_options={"on_function_approval": prompt_for_approval_async},
+        default_options={
+            "on_function_approval": auto_approve,
+            "on_permission_request": PermissionHandler.approve_all,
+        },
     )
     async with agent:
         query = "Give me the detailed weather for Tokyo."
@@ -112,6 +122,7 @@ async def run_without_callback() -> None:
     agent = GitHubCopilotAgent(
         instructions="You are a helpful weather assistant.",
         tools=[get_weather_detail],
+        default_options={"on_permission_request": PermissionHandler.approve_all},
     )
     async with agent:
         query = "Give me the detailed weather for Paris."
@@ -122,8 +133,8 @@ async def run_without_callback() -> None:
 
 async def main() -> None:
     print("=== GitHub Copilot Agent: Function approval enforcement ===")
-    await run_with_sync_callback()
-    await run_with_async_callback()
+    await run_with_interactive_callback()
+    await run_with_auto_approve_callback()
     await run_without_callback()
 
 

python/samples/02-agents/providers/github_copilot/github_copilot_with_instruction_directories.py

@@ -22,24 +22,13 @@ import asyncio
 from pathlib import Path
 
 from agent_framework.github import GitHubCopilotAgent
-from copilot.generated.session_events import PermissionRequest
-from copilot.session import PermissionRequestResult
+from copilot.session import PermissionHandler
 from dotenv import load_dotenv
 
 # Load environment variables from .env file
 load_dotenv()
 
 
-def prompt_permission(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
-    """Permission handler that prompts the user for approval."""
-    print(f"\n[Permission Request: {request.kind}]")
-
-    response = input("Approve? (y/n): ").strip().lower()
-    if response in ("y", "yes"):
-        return PermissionRequestResult(kind="approved")
-    return PermissionRequestResult(kind="denied-interactively-by-user")
-
-
 async def default_instructions_example() -> None:
     """Example of pointing the agent at project-specific instruction directories."""
     print("=== Instruction Directories (Default) ===\n")
@@ -58,7 +47,7 @@ async def default_instructions_example() -> None:
     agent = GitHubCopilotAgent(
         instructions="You are a helpful coding assistant.",
         default_options={
-            "on_permission_request": prompt_permission,
+            "on_permission_request": PermissionHandler.approve_all,
             "instruction_directories": instruction_dirs,
         },
     )
@@ -79,7 +68,7 @@ async def runtime_override_example() -> None:
     agent = GitHubCopilotAgent(
         instructions="You are a helpful assistant.",
         default_options={
-            "on_permission_request": prompt_permission,
+            "on_permission_request": PermissionHandler.approve_all,
             "instruction_directories": ["/team/shared/instructions"],
         },
     )

python/samples/02-agents/providers/github_copilot/github_copilot_with_mcp.py

@@ -15,24 +15,13 @@ of MCP-related actions.
 import asyncio
 
 from agent_framework.github import GitHubCopilotAgent
-from copilot.generated.session_events import PermissionRequest
-from copilot.session import MCPServerConfig, PermissionRequestResult
+from copilot.session import MCPServerConfig, PermissionHandler
 from dotenv import load_dotenv
 
 # Load environment variables from .env file
 load_dotenv()
 
 
-def prompt_permission(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
-    """Permission handler that prompts the user for approval."""
-    print(f"\n[Permission Request: {request.kind}]")
-
-    response = input("Approve? (y/n): ").strip().lower()
-    if response in ("y", "yes"):
-        return PermissionRequestResult(kind="approved")
-    return PermissionRequestResult(kind="denied-interactively-by-user")
-
-
 async def main() -> None:
     print("=== GitHub Copilot Agent with MCP Servers ===\n")
 
@@ -56,7 +45,7 @@ async def main() -> None:
     agent = GitHubCopilotAgent(
         instructions="You are a helpful assistant with access to the local filesystem and Microsoft Learn.",
         default_options={
-            "on_permission_request": prompt_permission,
+            "on_permission_request": PermissionHandler.approve_all,
             "mcp_servers": mcp_servers,
         },
     )

python/samples/02-agents/providers/github_copilot/github_copilot_with_multiple_permissions.py

@@ -3,9 +3,8 @@
 """
 GitHub Copilot Agent with Multiple Permissions
 
-This sample demonstrates how to enable multiple permission types with GitHubCopilotAgent.
-By combining different permission kinds in the handler, the agent can perform complex tasks
-that require multiple capabilities.
+This sample demonstrates how multiple permission types are requested when GitHubCopilotAgent
+performs complex tasks that require different capabilities.
 
 Available permission kinds:
 - "shell": Execute shell commands
@@ -21,23 +20,14 @@ More permissions mean more potential for unintended actions.
 import asyncio
 
 from agent_framework.github import GitHubCopilotAgent
-from copilot.generated.session_events import PermissionRequest
-from copilot.session import PermissionRequestResult
+from copilot.session import PermissionHandler, PermissionRequestResult
+from copilot.session_events import PermissionRequest
 
 
-def prompt_permission(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
-    """Permission handler that prompts the user for approval."""
-    print(f"\n[Permission Request: {request.kind}]")
-
-    if request.full_command_text is not None:
-        print(f"  Command: {request.full_command_text}")
-    if request.path is not None:
-        print(f"  Path: {request.path}")
-
-    response = input("Approve? (y/n): ").strip().lower()
-    if response in ("y", "yes"):
-        return PermissionRequestResult(kind="approved")
-    return PermissionRequestResult(kind="denied-interactively-by-user")
+def approve_and_log(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
+    """Permission handler that auto-approves and logs each permission kind."""
+    print(f"  [Permission: {request.kind}]", flush=True)
+    return PermissionHandler.approve_all(request, context)
 
 
 async def main() -> None:
@@ -45,14 +35,14 @@ async def main() -> None:
 
     agent = GitHubCopilotAgent(
         instructions="You are a helpful development assistant that can read, write files and run commands.",
-        default_options={"on_permission_request": prompt_permission},
+        default_options={"on_permission_request": approve_and_log},
     )
 
     async with agent:
         query = "List the first 3 Python files, then read the first one and create a summary in summary.txt"
-        print(f"User: {query}")
+        print(f"User: {query}\n")
         result = await agent.run(query)
-        print(f"Agent: {result}\n")
+        print(f"\nAgent: {result}\n")
 
 
 if __name__ == "__main__":

python/samples/02-agents/providers/github_copilot/github_copilot_with_session.py

@@ -14,24 +14,10 @@ from typing import Annotated
 
 from agent_framework import tool
 from agent_framework.github import GitHubCopilotAgent
-from copilot.generated.session_events import PermissionRequest
-from copilot.session import PermissionRequestResult
+from copilot.session import PermissionHandler
 from pydantic import Field
 
 
-def prompt_permission(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
-    """Permission handler that prompts the user for approval."""
-    print(f"\n[Permission Request: {request.kind}]")
-
-    if request.full_command_text is not None:
-        print(f"  Command: {request.full_command_text}")
-
-    response = input("Approve? (y/n): ").strip().lower()
-    if response in ("y", "yes"):
-        return PermissionRequestResult(kind="approved")
-    return PermissionRequestResult(kind="denied-interactively-by-user")
-
-
 # NOTE: approval_mode="never_require" is for sample brevity. Use "always_require" in production;
 # see samples/02-agents/tools/function_tool_with_approval.py
 # and samples/02-agents/tools/function_tool_with_approval_and_sessions.py.
@@ -51,7 +37,7 @@ async def example_with_automatic_session_creation() -> None:
     agent = GitHubCopilotAgent(
         instructions="You are a helpful weather agent.",
         tools=[get_weather],
-        default_options={"on_permission_request": prompt_permission},
+        default_options={"on_permission_request": PermissionHandler.approve_all},
     )
 
     async with agent:
@@ -76,7 +62,7 @@ async def example_with_session_persistence() -> None:
     agent = GitHubCopilotAgent(
         instructions="You are a helpful weather agent.",
         tools=[get_weather],
-        default_options={"on_permission_request": prompt_permission},
+        default_options={"on_permission_request": PermissionHandler.approve_all},
     )
 
     async with agent:
@@ -113,7 +99,7 @@ async def example_with_existing_session_id() -> None:
     agent1 = GitHubCopilotAgent(
         instructions="You are a helpful weather agent.",
         tools=[get_weather],
-        default_options={"on_permission_request": prompt_permission},
+        default_options={"on_permission_request": PermissionHandler.approve_all},
     )
 
     async with agent1:
@@ -135,7 +121,7 @@ async def example_with_existing_session_id() -> None:
         agent2 = GitHubCopilotAgent(
             instructions="You are a helpful weather agent.",
             tools=[get_weather],
-            default_options={"on_permission_request": prompt_permission},
+            default_options={"on_permission_request": PermissionHandler.approve_all},
         )
 
         async with agent2:

python/samples/02-agents/providers/github_copilot/github_copilot_with_shell.py

@@ -14,21 +14,20 @@ Shell commands have full access to your system within the permissions of the run
 import asyncio
 
 from agent_framework.github import GitHubCopilotAgent
-from copilot.generated.session_events import PermissionRequest
-from copilot.session import PermissionRequestResult
+from copilot.generated.rpc import PermissionDecisionUserNotAvailable
+from copilot.session import PermissionHandler, PermissionRequestResult
+from copilot.session_events import PermissionRequest
 
 
-def prompt_permission(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
-    """Permission handler that prompts the user for approval."""
-    print(f"\n[Permission Request: {request.kind}]")
-
-    if request.full_command_text is not None:
-        print(f"  Command: {request.full_command_text}")
-
-    response = input("Approve? (y/n): ").strip().lower()
-    if response in ("y", "yes"):
-        return PermissionRequestResult(kind="approved")
-    return PermissionRequestResult(kind="denied-interactively-by-user")
+def approve_and_log(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
+    """Permission handler that approves only shell commands and logs them."""
+    if request.kind == "shell":
+        print(f"\n  [Permission: {request.kind}]", flush=True)
+        command = getattr(request, "full_command_text", None)
+        if command is not None:
+            print(f"  Command: {command}", flush=True)
+        return PermissionHandler.approve_all(request, context)
+    return PermissionDecisionUserNotAvailable()
 
 
 async def main() -> None:
@@ -36,14 +35,14 @@ async def main() -> None:
 
     agent = GitHubCopilotAgent(
         instructions="You are a helpful assistant that can execute shell commands.",
-        default_options={"on_permission_request": prompt_permission},
+        default_options={"on_permission_request": approve_and_log},
     )
 
     async with agent:
         query = "List the first 3 Python files in the current directory"
         print(f"User: {query}")
         result = await agent.run(query)
-        print(f"Agent: {result}\n")
+        print(f"\nAgent: {result}\n")
 
 
 if __name__ == "__main__":

python/samples/02-agents/providers/github_copilot/github_copilot_with_url.py

@@ -14,21 +14,20 @@ URL fetching allows the agent to access any URL accessible from your network.
 import asyncio
 
 from agent_framework.github import GitHubCopilotAgent
-from copilot.generated.session_events import PermissionRequest
-from copilot.session import PermissionRequestResult
+from copilot.generated.rpc import PermissionDecisionUserNotAvailable
+from copilot.session import PermissionHandler, PermissionRequestResult
+from copilot.session_events import PermissionRequest
 
 
-def prompt_permission(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
-    """Permission handler that prompts the user for approval."""
-    print(f"\n[Permission Request: {request.kind}]")
-
-    if request.url is not None:
-        print(f"  URL: {request.url}")
-
-    response = input("Approve? (y/n): ").strip().lower()
-    if response in ("y", "yes"):
-        return PermissionRequestResult(kind="approved")
-    return PermissionRequestResult(kind="denied-interactively-by-user")
+def approve_and_log(request: PermissionRequest, context: dict[str, str]) -> PermissionRequestResult:
+    """Permission handler that approves only URL requests and logs them."""
+    if request.kind == "url":
+        print(f"\n  [Permission: {request.kind}]", flush=True)
+        url = getattr(request, "url", None)
+        if url is not None:
+            print(f"  URL: {url}", flush=True)
+        return PermissionHandler.approve_all(request, context)
+    return PermissionDecisionUserNotAvailable()
 
 
 async def main() -> None:
@@ -36,14 +35,14 @@ async def main() -> None:
 
     agent = GitHubCopilotAgent(
         instructions="You are a helpful assistant that can fetch and summarize web content.",
-        default_options={"on_permission_request": prompt_permission},
+        default_options={"on_permission_request": approve_and_log},
     )
 
     async with agent:
         query = "Fetch https://learn.microsoft.com/agent-framework/tutorials/quick-start and summarize its contents"
         print(f"User: {query}")
         result = await agent.run(query)
-        print(f"Agent: {result}\n")
+        print(f"\nAgent: {result}\n")
 
 
 if __name__ == "__main__":

python/samples/04-hosting/foundry-hosted-agents/responses/04_foundry_toolbox/README.md

@@ -20,7 +20,7 @@ You can connect to MCP servers in Foundry Toolbox that use different authenticat
 - **Agent identity authentication**: The tool requires an agent identity token to authenticate. Sample MCP server: `https://{foundry-resource-name}.cognitiveservices.azure.com/language/mcp?api-version=2025-11-15-preview` (Azure Language MCP server) with agent identity for authentication.
 - **Entra Pass-through authentication**: The tool requires an Entra pass-through token to authenticate. Sample MCP server: Microsoft Outlook MCP server with Entra pass-through for authentication.
 
-> Definitions of these authentication methods can be found in the [agent.manifest.yaml](agent.manifest.yaml) file in this sample.
+> Definitions of these authentication methods can be found in the [agent.manifest.yaml](agent.manifest.yaml) file in this sample. The GitHub MCP connection defaults to using a PAT for authentication in this sample, but you can switch to OAuth2 by changing the `project_connection_id` field in the `agent.manifest.yaml` file and following the instructions in the comments.
 
 There are also Non-MCP tools in the toolbox that support different authentication methods. Learn more at the [Foundry sample repository](https://github.com/microsoft-foundry/foundry-samples/blob/main/samples/python/hosted-agents/SUPPORTED_TOOLBOX_SCENARIOS.md).
 

python/samples/04-hosting/foundry-hosted-agents/responses/04_foundry_toolbox/agent.manifest.yaml

@@ -18,92 +18,92 @@ template:
     - name: AZURE_AI_MODEL_DEPLOYMENT_NAME
       value: "{{AZURE_AI_MODEL_DEPLOYMENT_NAME}}"
     - name: TOOLBOX_NAME
-      value: "agent-tools-2"
-# parameters:
-#   properties:
-# - name: mcp_endpoint
-#   # `azd ai agent init -m` will prompt for this value when initializing the agent manifest
-#   secret: false
-#   description: URL of the public MCP server (e.g. https://gitmcp.io/Azure/azure-rest-api-specs) that does not require authentication
-# - name: github_pat
-#   # `azd ai agent init -m` will prompt for this value when initializing the agent manifest.
-#   # Only needed when the GitHub MCP connection is configured to use the `github-mcp-pat-conn`
-#   # PAT-based connection below; if you use the `github-mcp-oauth-conn` OAuth2 connection
-#   # instead, you can leave this empty.
-#   secret: true
-#   description: GitHub Personal Access Token used to authenticate with the GitHub MCP server (only needed when using the PAT connection; press Enter if using OAuth2 instead)
-# - name: language_mcp_entra_audience
-#   secret: false
-#   description: Entra ID audience for the Azure Language MCP server (e.g. https://cognitiveservices.azure.com/)
-# - name: language_mcp_target_url
-#   secret: false
-#   description: URL of the Azure Language MCP server that accepts agent identity tokens (e.g. https://{foundry-resource-name}.cognitiveservices.azure.com/language/mcp?api-version=2025-11-15-preview)
-# - name: outlook_mail_entra_audience
-#   secret: false
-#   description: Entra ID audience for the Outlook Mail MCP server
-# - name: outlook_mail_entra_mcp_target
-#   secret: false
-#   description: URL of the Outlook Mail MCP server that accepts user Entra tokens
+      value: "agent-tools"
+parameters:
+  properties:
+    - name: mcp_endpoint
+      # `azd ai agent init -m` will prompt for this value when initializing the agent manifest
+      secret: false
+      description: URL of the public MCP server (e.g. https://gitmcp.io/Azure/azure-rest-api-specs) that does not require authentication
+    - name: github_pat
+      # `azd ai agent init -m` will prompt for this value when initializing the agent manifest.
+      # Only needed when the GitHub MCP connection is configured to use the `github-mcp-pat-conn`
+      # PAT-based connection below; if you use the `github-mcp-oauth-conn` OAuth2 connection
+      # instead, you can leave this empty.
+      secret: true
+      description: GitHub Personal Access Token used to authenticate with the GitHub MCP server (only needed when using the PAT connection; press Enter if using OAuth2 instead)
+  # - name: language_mcp_entra_audience
+  #   secret: false
+  #   description: Entra ID audience for the Azure Language MCP server (e.g. https://cognitiveservices.azure.com/)
+  # - name: language_mcp_target_url
+  #   secret: false
+  #   description: URL of the Azure Language MCP server that accepts agent identity tokens (e.g. https://{foundry-resource-name}.cognitiveservices.azure.com/language/mcp?api-version=2025-11-15-preview)
+  # - name: outlook_mail_entra_audience
+  #   secret: false
+  #   description: Entra ID audience for the Outlook Mail MCP server
+  # - name: outlook_mail_entra_mcp_target
+  #   secret: false
+  #   description: URL of the Outlook Mail MCP server that accepts user Entra tokens
 resources:
   - kind: model
     id: gpt-4.1-mini
     name: AZURE_AI_MODEL_DEPLOYMENT_NAME
-  # - kind: connection
-  #   # A connection that uses a GitHub Personal Access Token (PAT) to authenticate with the GitHub MCP server
-  #   name: github-mcp-pat-conn
-  #   category: RemoteTool
-  #   authType: CustomKeys
-  #   target: https://api.githubcopilot.com/mcp
-  #   credentials:
-  #     type: CustomKeys
-  #     keys:
-  #       Authorization: "Bearer {{ github_pat }}"
-  # - kind: connection
-  #   # A connection that uses OAuth2 to authenticate with the GitHub MCP server
-  #   name: github-mcp-oauth-conn
-  #   category: RemoteTool
-  #   authType: OAuth2
-  #   target: https://api.githubcopilot.com/mcp
-  #   connectorName: foundrygithubmcp
-  #   credentials:
-  #     type: OAuth2
-  #     clientId: managed
-  #     clientSecret: managed
+  - kind: connection
+    # A connection that uses a GitHub Personal Access Token (PAT) to authenticate with the GitHub MCP server
+    name: github-mcp-pat-conn
+    category: RemoteTool
+    authType: CustomKeys
+    target: https://api.githubcopilot.com/mcp
+    credentials:
+      type: CustomKeys
+      keys:
+        Authorization: "Bearer {{ github_pat }}"
+  - kind: connection
+    # A connection that uses OAuth2 to authenticate with the GitHub MCP server
+    name: github-mcp-oauth-conn
+    category: RemoteTool
+    authType: OAuth2
+    target: https://api.githubcopilot.com/mcp
+    connectorName: foundrygithubmcp
+    credentials:
+      type: OAuth2
+      clientId: managed
+      clientSecret: managed
   # - kind: connection
   #   name: language-mcp-conn
   #   category: RemoteTool
   #   authType: AgenticIdentity
   #   audience: "{{ language_mcp_entra_audience }}"
   #   target: "{{ language_mcp_target_url }}"
-  # # - kind: connection
-  # #   name: outlook-mail-conn
-  # #   category: RemoteTool
-  # #   authType: UserEntraToken
-  # #   audience: "{{ outlook_mail_entra_audience }}"
-  # #   target: "{{ outlook_mail_entra_mcp_target }}"
-  # - kind: toolbox
-  #   name: agent-tools
-  #   tools:
-  #     - type: web_search
-  #       name: web_search
-  #     - type: code_interpreter
-  #       name: code_interpreter
-  #     # - type: mcp
-  #     #   # This MCP tool doesn't require authentication
-  #     #   server_label: noauth_mcp
-  #     #   server_url: "{{ mcp_endpoint }}"
-  #     #   require_approval: "never"
-  #     - type: mcp
-  #       # This MCP tool uses the GitHub MCP server with a PAT for authentication or OAuth2
-  #       server_label: github
-  #       project_connection_id: github-mcp-pat-conn # use `github-mcp-oauth-conn` for OAuth2 authentication
-  #       require_approval: "never"
-  #     - type: mcp
-  #       # This MCP tool uses the Azure Language MCP server with agent identity for authentication
-  #       server_label: language-mcp
-  #       project_connection_id: language-mcp-conn
-  #       require_approval: "never"
-  #     # - type: mcp
-  #     #   server_label: outlook-mail
-  #     #   project_connection_id: outlook-mail-conn
-  #     #   require_approval: "never"
+  # - kind: connection
+  #   name: outlook-mail-conn
+  #   category: RemoteTool
+  #   authType: UserEntraToken
+  #   audience: "{{ outlook_mail_entra_audience }}"
+  #   target: "{{ outlook_mail_entra_mcp_target }}"
+  - kind: toolbox
+    name: agent-tools
+    tools:
+      - type: web_search
+        name: web_search
+      - type: code_interpreter
+        name: code_interpreter
+      - type: mcp
+        # This MCP tool doesn't require authentication
+        server_label: noauth_mcp
+        server_url: "{{ mcp_endpoint }}"
+        require_approval: "never"
+      - type: mcp
+        # This MCP tool uses the GitHub MCP server with a PAT for authentication or OAuth2
+        server_label: github
+        project_connection_id: github-mcp-pat-conn # use `github-mcp-oauth-conn` for OAuth2 authentication
+        require_approval: "never"
+      # - type: mcp
+      #   # This MCP tool uses the Azure Language MCP server with agent identity for authentication
+      #   server_label: language-mcp
+      #   project_connection_id: language-mcp-conn
+      #   require_approval: "never"
+      # - type: mcp
+      #   server_label: outlook-mail
+      #   project_connection_id: outlook-mail-conn
+      #   require_approval: "never"

python/samples/04-hosting/foundry-hosted-agents/responses/04_foundry_toolbox/requirements.txt

@@ -1,4 +1,3 @@
-# agent-framework
-# agent-framework-foundry-hosting
-
+agent-framework
+agent-framework-foundry-hosting
 mcp>=1.24.0,<2

python/scripts/sample_validation/create_dynamic_workflow_executor.py

@@ -14,8 +14,8 @@ from agent_framework import (
     handler,
 )
 from agent_framework.github import GitHubCopilotAgent
-from copilot.generated.session_events import PermissionRequest
-from copilot.session import PermissionRequestResult
+from copilot.session import PermissionHandler, PermissionRequestResult
+from copilot.session_events import PermissionRequest
 from pydantic import BaseModel
 from sample_validation.const import WORKER_COMPLETED
 from sample_validation.discovery import DiscoveryResult
@@ -103,7 +103,7 @@ def prompt_permission(
     logger.debug(
         f"[Permission Request: {request.kind}] ({context})Automatically approved for sample validation."
     )
-    return PermissionRequestResult(kind="approved")
+    return PermissionHandler.approve_all(request, context)
 
 
 class CustomAgentExecutor(Executor):

python/uv.lock

@@ -115,7 +115,7 @@ wheels = [
 
 [[package]]
 name = "agent-framework"
-version = "1.7.0"
+version = "1.8.0"
 source = { virtual = "." }
 dependencies = [
     { name = "agent-framework-core", extra = ["all"], marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -170,7 +170,7 @@ dev = [
 
 [[package]]
 name = "agent-framework-a2a"
-version = "1.0.0b260528"
+version = "1.0.0b260604"
 source = { editable = "packages/a2a" }
 dependencies = [
     { name = "a2a-sdk", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -213,7 +213,7 @@ provides-extras = ["dev"]
 
 [[package]]
 name = "agent-framework-anthropic"
-version = "1.0.0b260521"
+version = "1.0.0b260604"
 source = { editable = "packages/anthropic" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -279,7 +279,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-azurefunctions"
-version = "1.0.0b260521"
+version = "1.0.0b260604"
 source = { editable = "packages/azurefunctions" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -301,7 +301,7 @@ dev = []
 
 [[package]]
 name = "agent-framework-bedrock"
-version = "1.0.0b260521"
+version = "1.0.0b260604"
 source = { editable = "packages/bedrock" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -363,7 +363,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-core"
-version = "1.7.0"
+version = "1.8.0"
 source = { editable = "packages/core" }
 dependencies = [
     { name = "opentelemetry-api", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -529,7 +529,7 @@ dev = [{ name = "types-python-dateutil", specifier = "==2.9.0.20260518" }]
 
 [[package]]
 name = "agent-framework-foundry"
-version = "1.7.0"
+version = "1.8.0"
 source = { editable = "packages/foundry" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -548,7 +548,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-foundry-hosting"
-version = "1.0.0a260528"
+version = "1.0.0a260604"
 source = { editable = "packages/foundry_hosting" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -599,7 +599,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-github-copilot"
-version = "1.0.0b260521"
+version = "1.0.0rc1"
 source = { editable = "packages/github_copilot" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -609,7 +609,7 @@ dependencies = [
 [package.metadata]
 requires-dist = [
     { name = "agent-framework-core", editable = "packages/core" },
-    { name = "github-copilot-sdk", marker = "python_full_version >= '3.11'", specifier = "<=1.0.0b2,>=1.0.0b2" },
+    { name = "github-copilot-sdk", marker = "python_full_version >= '3.11'", specifier = ">=1.0.0,<2" },
 ]
 
 [[package]]
@@ -729,7 +729,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-mistral"
-version = "1.0.0a260505"
+version = "1.0.0a260604"
 source = { editable = "packages/mistral" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -774,7 +774,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-openai"
-version = "1.7.0"
+version = "1.8.0"
 source = { editable = "packages/openai" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -789,7 +789,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-orchestrations"
-version = "1.0.0rc2"
+version = "1.0.0rc3"
 source = { editable = "packages/orchestrations" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -2608,19 +2608,19 @@ wheels = [
 
 [[package]]
 name = "github-copilot-sdk"
-version = "1.0.0b2"
+version = "1.0.0"
 source = { registry = "https://pypi.org/simple" }
 dependencies = [
     { name = "pydantic", marker = "(python_full_version >= '3.11' and sys_platform == 'darwin') or (python_full_version >= '3.11' and sys_platform == 'linux') or (python_full_version >= '3.11' and sys_platform == 'win32')" },
     { name = "python-dateutil", marker = "(python_full_version >= '3.11' and sys_platform == 'darwin') or (python_full_version >= '3.11' and sys_platform == 'linux') or (python_full_version >= '3.11' and sys_platform == 'win32')" },
 ]
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 [[package]]