diff --git a/tests/hghave.py b/tests/hghave.py
--- a/tests/hghave.py
+++ b/tests/hghave.py
@@ -191,7 +191,7 @@
 
 @check("chg", "running with chg")
 def has_chg():
-    return 'CHGHG' in os.environ
+    return 'CHG_INSTALLED_AS_HG' in os.environ
 
 
 @check("rhg", "running with rhg as 'hg'")
diff --git a/tests/run-tests.py b/tests/run-tests.py
--- a/tests/run-tests.py
+++ b/tests/run-tests.py
@@ -3166,9 +3166,11 @@
         # set CHGHG, then replace "hg" command by "chg"
         chgbindir = self._bindir
         if self.options.chg or self.options.with_chg:
+            osenvironb[b'CHG_INSTALLED_AS_HG'] = b'1'
             osenvironb[b'CHGHG'] = real_hg
         else:
-            osenvironb.pop(b'CHGHG', None)  # drop flag for hghave
+            # drop flag for hghave
+            osenvironb.pop(b'CHG_INSTALLED_AS_HG', None)
         if self.options.chg:
             self._hgcommand = b'chg'
         elif self.options.with_chg: