Guest user invites other guest user

Hi,

In my opitinion the issue isn’t with the SharePoint or Entra ID configuration itself, but with the boundary between SharePoint and Entra ID. While Entra ID allows guests to invite other guests at the directory (B2B) level, SharePoint does not delegate the creation of new guest objects during sharing. When a guest enters a new external email address, SharePoint would need to create a new guest user in Entra ID — and that operation is blocked when initiated by a guest. This results in the generic “organization’s policies” error.

Two practical workarounds I see:

 - Pre‑onboard guests in Entra ID — an internal user or an automated process invites external users first; once they exist, guests can share files with them.

 - Controlled self‑service — a form with a Power Automate / approval flow that creates the guest user in Entra ID and only then grants SharePoint access.

I think this is a SharePoint Online architectural limitation, not a missing configuration toggle