Options Replace and Merge are grayed out for Blocked and Approved Senders Lists in List Management (User List Control and Group List control), e.g.:
Email Security.cloud
The option is unavailable by default when there are no users or groups, this option can be applied to.
Populate User Control (Group List Control) list or change selected option from 'ALL of the selected email addresses will have user control' to 'ALL EXCEPT the selected email addresses will have user control'. Replace and Merge unavailable becomes available: