diff --git a/xml/impl/src/com/intellij/xml/actions/EscapeEntitiesAction.java b/xml/impl/src/com/intellij/xml/actions/EscapeEntitiesAction.java
index 4dccfddd38de..9c275e856634 100644
--- a/xml/impl/src/com/intellij/xml/actions/EscapeEntitiesAction.java
+++ b/xml/impl/src/com/intellij/xml/actions/EscapeEntitiesAction.java
@@ -79,7 +79,7 @@ public class EscapeEntitiesAction extends SimpleCodeInsightAction {
       char c = text.charAt(i);
       final PsiElement element = file.findElementAt(start + i);
       if (element != null && isCharacterElement(element)) {
-        if (c == '<' || c == '>' || c == '&' || c == '"' || c == '\'' || c > 0xff) {
+        if (c == '<' || c == '>' || c == '&' || c == '"' || c == '\'' || c > 0x7f) {
           final String escape = ESCAPES.getValue(file).get(c);
           if (escape != null) {
             result.append("&").append(escape).append(";");
diff --git a/xml/tests/src/com/intellij/codeInsight/editorActions/EscapeEntitiesActionTest.java b/xml/tests/src/com/intellij/codeInsight/editorActions/EscapeEntitiesActionTest.java
index 9cd5a3cdb71b..e7b6bfb52453 100644
--- a/xml/tests/src/com/intellij/codeInsight/editorActions/EscapeEntitiesActionTest.java
+++ b/xml/tests/src/com/intellij/codeInsight/editorActions/EscapeEntitiesActionTest.java
@@ -23,6 +23,7 @@ import com.intellij.testFramework.fixtures.LightCodeInsightFixtureTestCase;
  */
 public class EscapeEntitiesActionTest extends LightCodeInsightFixtureTestCase {
   private static final String NDASH = new String(new byte[]{-30, -128, -109}, CharsetToolkit.UTF8_CHARSET);
+  private static final String COPY = new String(new byte[]{-62, -82}, CharsetToolkit.UTF8_CHARSET);
 
   public void testSimpleHtml() {
     doTest("<<<", "html", "&lt;&lt;&lt;");
@@ -32,10 +33,14 @@ public class EscapeEntitiesActionTest extends LightCodeInsightFixtureTestCase {
     doTest(">>>", "xml", "&gt;&gt;&gt;");
   }
 
-  public void testWide() {
+  public void testVeryWide() {
     doTest(NDASH, "html", "&ndash;");
   }
 
+  public void testWide() {
+    doTest(COPY, "html", "&reg;");
+  }
+
   public void testAttributeValue() {
     doTest("<a alt='" + NDASH + "'></a>", "html", "<a alt='&ndash;'></a>");
   }