When users have anything on their restricted folder list, their access to repository content is limited to objects that are descendants of the listed item. If the restricted folder list is empty, the user has access to all folders, and cabinets in the repository, subject to the permissions on those cabinets, and folders subject to folder security.
Folder restriction never applies to:
Rooms in which the user is a member
System cabinets required for participation in the repository, such as /System, /Templates, and /Resources