The Crop Layer command crops only the
active layer to the boundary of the selection by removing any strips
at the edge whose contents are all completely unselected. Areas which
are partially selected (for example, by feathering) are not cropped.
If there is no selection for the image, the menu entry is insensitive
and grayed out.
Activating the Command
You can access this command from the image menubar through
Applying “Layer Crop”
On the left: before applying the command, the layer has
a selection that has feathered edges.
On the right: after applying the command, the non-transparent
pixels are not cropped, even if they are only partially