Appliance Mode (Hotadd) isn't available if proxy VM and its replica are running under the same vCenter

A VMware Backup Proxy is not processing VMs using Virtual Appliance (HOTADD) mode, despite meeting all requirements.

Veeam Backup & Replication uses VDDK to communicate with VMware infrastructure. Starting with VDDK 6.0, VMware added additional logic to validate possible transport modes on a proxy. This validation procedure checks if the VM (VMware Backup Proxy) attempting to perform hotadd shares a UUID with any other VM in the environment. If another VM has the same UUID as that VM, the hotadd process is denied.

Veeam Support has observed that this conflict most often occurs when a replica of the VMware Backup Proxy VM was created within the same vCenter Server.

Due to the additional checks implemented in the VMware VDDK 6.0 and higher, it is inadvisable to replicate any VMware Backup Proxy or Veeam Backup & Replication VM to the same vCenter managed environment as the original VM.

 

According to Best Practices, the best way to protect Veeam Backup & Replication is to use Configuration Backup.

It is recommended that you regularly perform configuration backup for every backup server in the backup infrastructure. Periodic configuration backups reduce the risk of data loss and minimize the administrative overhead if any problem with backup servers occurs. It is not recommended to back up the backup server configuration using backup jobs in Veeam Backup & Replication. For this reason, you must always use the configuration backup functionality to back up and restore configuration of the backup server.

Per Virtual Disk Development Kit 6.0 Release Notes https://www.vmware.com/support/developer/vddk/vddk-600-releasenotes.html#knownissues:
HotAdd skipped if proxy has same BIOS UUID as the target VM.
The VixDiskLib_ConnectEx function contains a pre-check for HotAdd to validate that the proxy is virtual machine. (HotAdd is not allowed on physical machines.) If the proxy VM and the target VM have the same BIOS UUID, validation fails because multiple VMs are returned from pre-check. This results in skipping HotAdd mode and reverting to another transport. The workaround is to make the BIOS UUID keys unique.