Apologies for the delay on this bug. There is a fix upstream in
5.11-rc1, I've backported the fix to the test kernel located here:

https://people.canonical.com/~sforshee/lp1900141/linux-5.4.0-59.65+lp1900141v202101061102/

I'm also attaching a script which reproduces the bug. In my testing the
problem looks to be fixed by this patch, but additional testing is
appreciated.

** Attachment added: "lp1900141.sh"
   
https://bugs.launchpad.net/ubuntu/+source/linux/+bug/1900141/+attachment/5449802/+files/lp1900141.sh

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https://bugs.launchpad.net/bugs/1900141

Title:
  overlay: permission regression in 5.4.0-51.56 due to patches related
  to CVE-2020-16120

Status in linux package in Ubuntu:
  In Progress

Bug description:
  We use unprivileged user namespaces with overlay mounts for
  containers. After recently upgrading our Focal kernels to 5.4.0-51.56
  this breaks, one cannot access files through the overlay mount in the
  container anymore. This is very likely caused by some of the patches
  that were added in relation to CVE-2020-16120.

  The following commands allow to reproduce the problem when executed as
  an arbitrary non-root user:

  mkdir /tmp/test /tmp/test/upper /tmp/test/work /tmp/test/usr
  unshare -m -U -r /bin/sh -c "mount -t overlay none /tmp/test/usr -o 
lowerdir=/usr,upperdir=/tmp/test/upper,workdir=/tmp/test/work; ls -l 
/tmp/test/usr/bin/id; file /tmp/test/usr/bin/id; /tmp/test/usr/bin/id"

  The output when broken is this:

  -rwxr-xr-x 1 nobody nogroup 47480 Sep  5  2019 /tmp/test/usr/bin/id
  /tmp/test/usr/bin/id: executable, regular file, no read permission
  /bin/sh: 1: /tmp/test/usr/bin/id: Operation not permitted

  The expected output is this:

  -rwxr-xr-x 1 nobody nogroup 43224 Jan 18  2018 /tmp/test/usr/bin/id
  /tmp/test/usr/bin/id: ELF 64-bit LSB shared object, ...
  uid=0(root) gid=0(root) groups=0(root),65534(nogroup)

  These commands create a user namespace and within it mount an overlay
  of /usr to /tmp/test/usr and then try to access something in it.

  This works on Ubuntu Bionic with kernel 4.15.0-121.123 (note that this
  already includes a fix for CVE-2020-16120) and on kernel 5.4.0-48.52
  but is broken on kernel 5.4.0-51.56, no matter whether on Bionic or
  Focal.

  So I strongly suspect that not the actual security fixes for
  CVE-2020-16120 are the cause, but one of the following two patches
  that according to the changelogs were applied in the same revision but
  only to 5.4, not to 4.15:

  ovl: call secutiry hook in ovl_real_ioctl()
  ovl: check permission to open real file

  The mail with the announcement (https://www.openwall.com/lists/oss-
  security/2020/10/13/6) lists these two commits as separate from the
  actual security fixes ("may be desired or necessary").

  Is it possible to revert these two changes or fix them such that our
  unprivileged containers work again on Ubuntu kernel 5.4? Or is there a
  workaround that I can add to my container solution such that this use
  case works again?

  ProblemType: Bug
  DistroRelease: Ubuntu 20.04
  Package: linux-image-5.4.0-51-generic 5.4.0-51.56
  ProcVersionSignature: User Name 5.4.0-51.56-generic 5.4.65
  Uname: Linux 5.4.0-51-generic x86_64
  AlsaDevices:
   total 0
   crw-rw---- 1 root audio 116,  1 Oct 14 04:48 seq
   crw-rw---- 1 root audio 116, 33 Oct 14 04:48 timer
  AplayDevices: Error: [Errno 2] No such file or directory: 'aplay'
  ApportVersion: 2.20.11-0ubuntu27.9
  Architecture: amd64
  ArecordDevices: Error: [Errno 2] No such file or directory: 'arecord'
  AudioDevicesInUse: Error: [Errno 2] No such file or directory: 'fuser'
  CasperMD5CheckResult: skip
  CurrentDmesg: Error: command ['dmesg'] failed with exit code 1: dmesg: read 
kernel buffer failed: Operation not permitted
  Date: Fri Oct 16 13:02:32 2020
  IwConfig: Error: [Errno 2] No such file or directory: 'iwconfig'
  Lsusb:
   Bus 001 Device 002: ID 0627:0001 Adomax Technology Co., Ltd QEMU USB Tablet
   Bus 001 Device 001: ID 1d6b:0001 Linux Foundation 1.1 root hub
  Lsusb-t:
   /:  Bus 01.Port 1: Dev 1, Class=root_hub, Driver=uhci_hcd/2p, 12M
       |__ Port 1: Dev 2, If 0, Class=Human Interface Device, Driver=usbhid, 12M
  MachineType: QEMU Standard PC (i440FX + PIIX, 1996)
  PciMultimedia:
   
  ProcEnviron:
   TERM=screen-256color
   PATH=(custom, no user)
   XDG_RUNTIME_DIR=<set>
   LANG=C.UTF-8
   SHELL=/bin/bash
  ProcFB: 0 bochs-drmdrmfb
  ProcKernelCmdLine: BOOT_IMAGE=/boot/vmlinuz-5.4.0-51-generic 
root=PARTUUID=59ea2f51-599c-49f2-b9b3-77197e333865 ro console=tty1 console=ttyS0
  RelatedPackageVersions:
   linux-restricted-modules-5.4.0-51-generic N/A
   linux-backports-modules-5.4.0-51-generic  N/A
   linux-firmware                            1.187.3
  RfKill: Error: [Errno 2] No such file or directory: 'rfkill'
  SourcePackage: linux
  UpgradeStatus: No upgrade log present (probably fresh install)
  dmi.bios.date: 04/01/2014
  dmi.bios.vendor: SeaBIOS
  dmi.bios.version: rel-1.13.0-0-gf21b5a4aeb02-prebuilt.qemu.org
  dmi.chassis.type: 1
  dmi.chassis.vendor: QEMU
  dmi.chassis.version: pc-i440fx-5.0
  dmi.modalias: 
dmi:bvnSeaBIOS:bvrrel-1.13.0-0-gf21b5a4aeb02-prebuilt.qemu.org:bd04/01/2014:svnQEMU:pnStandardPC(i440FX+PIIX,1996):pvrpc-i440fx-5.0:cvnQEMU:ct1:cvrpc-i440fx-5.0:
  dmi.product.name: Standard PC (i440FX + PIIX, 1996)
  dmi.product.version: pc-i440fx-5.0
  dmi.sys.vendor: QEMU

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