Virtual machines (VMs) with private IP addresses may experience communication issues if one VM is connected to a Tier-1 (T1) gateway and another to a Tier-0 (T0) gateway. This limitation is also observed in Federation topologies where a global T1 Distributed Router (DR) spans the same site as the T0 gateway.
VMware NSX
Configuring NAT exclusively on Tier-0 (T0) uplink, CSP, or VTI interfaces is recommended, while avoiding NAT configurations on backplane or inter-SR ports. If NAT services are necessary, it is advisable to apply NAT rules on Tier-1 (T1) service routers to ensure proper functionality.