FULL PRODUCT VERSION :
java version "1.6.0_04"
Java(TM) SE Runtime Environment (build 1.6.0_04-b12)
Java HotSpot(TM) Client VM (build 10.0-b19, mixed mode)

ADDITIONAL OS VERSION INFORMATION :
Windows XP Professional SP3

EXTRA RELEVANT SYSTEM CONFIGURATION :
IE6, internet options proxy set to use automatic configuration script

A DESCRIPTION OF THE PROBLEM :
When the group policy "make proxy settings per-machine" is enabled, Java plug-in appears to load the proxy settings for the current user and not the machine. If Java proxy settings is configured to use browser proxy, then it will fail to load the proxy settings and use direct connect.

STEPS TO FOLLOW TO REPRODUCE THE PROBLEM :
Before attempting this be certain to enable "make proxy settings per-machine". Steps to verify:

1. Go to the group policy editor. You can get they by typing gpedit.msc into the Run dialog.
2. Navigate to computer configuration->administrative templates->windows components->internet explorer.

Using an windows account with admin rights, configure proxy settings for IE to use automatic configuration script. In Java control panel under Network Proxy settings, select the option to user browsers settings. Logout and login with a different windows account. Start browser and launch Java console, set debug to 5 and reload proxy settings. The trace is as follows:

********************************************************************************
Reload proxy configuration ...
network: Loading user-defined proxy configuration ...
network: Done.
network: Loading proxy configuration from Internet Explorer ...
network: Done.
network: Loading direct proxy configuration ...
network: Done.
network: Proxy Configuration: No proxy
********************************************************************************

 

EXPECTED VERSUS ACTUAL BEHAVIOR :
EXPECTED -

Java console trace:

Reload proxy configuration ...
network: Loading user-defined proxy configuration ...
network: Done.
network: Loading proxy configuration from Internet Explorer ...
network: Auto config URL: http://***.***.***.***:8080
network: Done.
network: Loading auto proxy configuration ...
network: Downloading auto proxy file from http://***.***.***.***:8080
network: Cache entry not found [url: http://***.***.***.***:8080/, version: null]
network: Done.
network: Proxy Configuration: Automatic Proxy Configuration
URL: http://***.***.***.***:8080
Done.
ACTUAL -
Reload proxy configuration ...
network: Loading user-defined proxy configuration ...
network: Done.
network: Loading proxy configuration from Internet Explorer ...
network: Done.
network: Loading direct proxy configuration ...
network: Done.
network: Proxy Configuration: No proxy

REPRODUCIBILITY :
This bug can be reproduced always.

CUSTOMER SUBMITTED WORKAROUND :
Login with the windows admin account and disabled the "make proxy settings per-machine" policy.
Logout and login with another account and configure the proxy settings in the browser.