diff --git a/openpype/hosts/blender/api/plugin.py b/openpype/hosts/blender/api/plugin.py
index 34ba551f081..ade243040c4 100644
--- a/openpype/hosts/blender/api/plugin.py
+++ b/openpype/hosts/blender/api/plugin.py
@@ -741,16 +741,31 @@ def _load_library_datablocks(
             datacol.foreach_set("use_fake_user", seq)
 
         if self.bl_types & BL_OUTLINER_TYPES:
-            # Override datablocks if needed
-            if do_override:
-                # Get datablocks to override, which have no user in the loaded datablocks (orphan at this point)
-                datablocks_to_override = {
+            # Get datablocks to override, which have
+            # no user in the loaded datablocks (orphan at this point)
+            datablocks_to_override = {
                     d
                     for d, users in bpy.data.user_map(
                         subset=datablocks
                     ).items()
                     if not users & datablocks
                 }
+
+            # Try to get the right asset container from imported collections.
+            # TODO this whole outliner entity is a bad idea
+            # it must be refactored to deal correctly with nested
+            # outliner entities using user_map()
+            outliner_entity = next(
+                (
+                    entity
+                    for entity in datablocks_to_override
+                    if entity.name.startswith(container_name)
+                ),
+                None,
+            )
+
+            # Override datablocks if needed
+            if do_override:
                 datablocks = set()
                 for d in datablocks_to_override:
                     override_datablock = d.override_hierarchy_create(
@@ -758,10 +773,9 @@ def _load_library_datablocks(
                         bpy.context.view_layer
                         # NOTE After BL3.4: do_fully_editable=True
                     )
-                    # Ensure user override NOTE: will be unecessary after BL3.4
-                    override_datablock.override_library.is_system_override = (
-                        False
-                    )
+
+                    # Update outliner entity
+                    outliner_entity = override_datablock
 
                     # Update datablocks because could have been renamed
                     datablocks.add(override_datablock)
@@ -778,16 +792,10 @@ def _load_library_datablocks(
                                 set(override_datablock.all_objects)
                             )
 
-            # Get the right asset container from imported collections.
-            outliner_entity = next(
-                (
-                    entity
-                    for entity in list(data_to.collections)
-                    + list(data_to.objects)
-                    if entity.name.startswith(container_name)
-                ),
-                None,
-            )
+                # Ensure user override NOTE: will be unecessary after BL3.4
+                for d in datablocks:
+                    if hasattr(d.override_library, "is_system_override"):
+                        d.override_library.is_system_override = False
 
             if outliner_entity:
                 # Set color
@@ -796,6 +804,8 @@ def _load_library_datablocks(
 
                 # Substitute name in case renamed with .###
                 container_name = outliner_entity.name
+        else:
+            outliner_entity = None
 
         # Put into container
         container = self._containerize_datablocks(
@@ -804,7 +814,8 @@ def _load_library_datablocks(
 
         # Set data to container
         container.library = bpy.data.libraries.get(libpath.name)
-        container.outliner_entity = outliner_entity
+        if outliner_entity:
+            container.outliner_entity = outliner_entity
 
         return container, datablocks