diff --git a/mercurial/merge.py b/mercurial/merge.py
--- a/mercurial/merge.py
+++ b/mercurial/merge.py
@@ -552,6 +552,7 @@ class mergeresult(object):
     NO_OP_ACTIONS = (
         mergestatemod.ACTION_KEEP,
         mergestatemod.ACTION_KEEP_ABSENT,
+        mergestatemod.ACTION_KEEP_NEW,
     )
 
     def __init__(self):
@@ -921,7 +922,7 @@ def manifestmerge(
             else:  # file not in ancestor, not in remote
                 mresult.addfile(
                     f,
-                    mergestatemod.ACTION_KEEP,
+                    mergestatemod.ACTION_KEEP_NEW,
                     None,
                     b'ancestor missing, remote missing',
                 )
@@ -1191,6 +1192,11 @@ def calculateupdates(
                 repo.ui.note(_(b" %s: picking 'keep absent' action\n") % f)
                 mresult.addfile(f, *bids[mergestatemod.ACTION_KEEP_ABSENT][0])
                 continue
+            # If keep new is an option, let's just do that
+            if mergestatemod.ACTION_KEEP_NEW in bids:
+                repo.ui.note(_(b" %s: picking 'keep new' action\n") % f)
+                mresult.addfile(f, *bids[mergestatemod.ACTION_KEEP_NEW][0])
+                continue
             # If there are gets and they all agree [how could they not?], do it.
             if mergestatemod.ACTION_GET in bids:
                 ga0 = bids[mergestatemod.ACTION_GET][0]
@@ -1496,16 +1502,10 @@ def applyupdates(
         progress.increment(item=f)
 
     # keep (noop, just log it)
-    for f, args, msg in mresult.getactions(
-        (mergestatemod.ACTION_KEEP,), sort=True
-    ):
-        repo.ui.debug(b" %s: %s -> k\n" % (f, msg))
-        # no progress
-    for f, args, msg in mresult.getactions(
-        (mergestatemod.ACTION_KEEP_ABSENT,), sort=True
-    ):
-        repo.ui.debug(b" %s: %s -> ka\n" % (f, msg))
-        # no progress
+    for a in mergeresult.NO_OP_ACTIONS:
+        for f, args, msg in mresult.getactions((a,), sort=True):
+            repo.ui.debug(b" %s: %s -> %s\n" % (f, msg, a))
+            # no progress
 
     # directory rename, move local
     for f, args, msg in mresult.getactions(
diff --git a/mercurial/mergestate.py b/mercurial/mergestate.py
--- a/mercurial/mergestate.py
+++ b/mercurial/mergestate.py
@@ -117,6 +117,9 @@ ACTION_KEEP = b'k'
 # keep it absent (absent means file not present, it can be a result
 # of file deletion, rename etc.)
 ACTION_KEEP_ABSENT = b'ka'
+# the file is absent on the ancestor and remote side of the merge
+# hence this file is new and we should keep it
+ACTION_KEEP_NEW = b'kn'
 ACTION_EXEC = b'e'
 ACTION_CREATED_MERGE = b'cm'
 
@@ -767,6 +770,10 @@ def recordupdates(repo, actions, branchm
     for f, args, msg in actions.get(ACTION_KEEP_ABSENT, []):
         pass
 
+    # keep new
+    for f, args, msg in actions.get(ACTION_KEEP_NEW, []):
+        pass
+
     # get
     for f, args, msg in actions.get(ACTION_GET, []):
         if branchmerge:
diff --git a/tests/test-merge-criss-cross.t b/tests/test-merge-criss-cross.t
--- a/tests/test-merge-criss-cross.t
+++ b/tests/test-merge-criss-cross.t
@@ -431,8 +431,8 @@ Verify that the old context ancestor wor
   resolving manifests
    branchmerge: True, force: False, partial: False
    ancestor: 11b5b303e36c, local: c0ef19750a22+, remote: 6ca01f7342b9
-   d1/a: ancestor missing, remote missing -> k
-   d1/b: ancestor missing, remote missing -> k
+   d1/a: ancestor missing, remote missing -> kn
+   d1/b: ancestor missing, remote missing -> kn
    d2/b: remote created -> g
   
   calculating bids for ancestor 154e6000f54e
@@ -452,13 +452,13 @@ Verify that the old context ancestor wor
   
   auction for merging merge bids (2 ancestors)
    list of bids for d1/a:
-     ancestor missing, remote missing -> k
+     ancestor missing, remote missing -> kn
      other deleted -> r
-   d1/a: picking 'keep' action
+   d1/a: picking 'keep new' action
    list of bids for d1/b:
-     ancestor missing, remote missing -> k
+     ancestor missing, remote missing -> kn
      other deleted -> r
-   d1/b: picking 'keep' action
+   d1/b: picking 'keep new' action
    list of bids for d2/b:
      remote created -> g
      remote created -> g
@@ -467,8 +467,8 @@ Verify that the old context ancestor wor
   
    d2/b: remote created -> g
   getting d2/b
-   d1/a: ancestor missing, remote missing -> k
-   d1/b: ancestor missing, remote missing -> k
+   d1/a: ancestor missing, remote missing -> kn
+   d1/b: ancestor missing, remote missing -> kn
   1 files updated, 0 files merged, 0 files removed, 0 files unresolved
   (branch merge, don't forget to commit)