Snapshot creation fails with error "Object policy is not compatible with datastore space efficiency policy configured on the cluster"

Products

• VMware Cloud on AWS
• VMware vSAN

Issue/Introduction

• Snapshot creations during VM backup fails with the below error:

  Object policy is not compatible with datastore space efficiency policy configured on the cluster. An error occurred while taking a snapshot: 22 (Invalid argument).
  

• VM Power On operation fail with error:
  

  Module VMMon power on failed. Failed to start the virtual machine. Failed to power on VM. Could not power on virtual machine: Failure. Failed to create swap file

• vMotion of the VM fails with error:
  

  A general system error occurred: Launch failure 2025-10-14T03:22:19.970158Z The VM failed to resume on the destination during early power on. Module VMMon power on failed. Cause: Module VMMon power on failed. 2025-10-14T03:22:19.970158Z The VM failed to resume on the destination during early power on.

• Additional failure persent in the clomd.log file on the host 
  
  

  CLOM_CheckClusterResourcesForPolicy: Target datastore space efficiency policy is not compatible with current cluster configuration. DedupAndCompression:1, CompressionOnly:0, None:1

Environment

VMware vSAN 8.x 

VMware Cloud on AWS

Cause

• This is a known issue caused by a race condition in the vSAN clomd module, when the vSAN Witness host's disks are marked as having Deduplication Disabled but not tagged as Witness disks which do not store data.
• Due to the vSAN Storage Policy having "Space efficiency" set to "Deduplication and Compression", the incompatibility error is thrown and vswp file creation fails. 

Resolution

• Restarting vSAN CLOMD service on all hosts in the Cluster is a valid work-around. 
• If this is VMC on AWS SDDC environment, please engage VMC on AWS Support. 
• A permanent fix would be available in a future version.

Additional Information

• KB: Virtual machine creation or power on fails on vSAN Cluster with Error - Invalid virtual machine configuration. Object policy is not compatible with datastore space efficiency policy configured on the cluster (relevant for on-prem VCF environments and not VMware Cloud on AWS)