Assignment of the ApplicationImpersonation Role Fails With Error

In Microsoft 365 organizations using modern app-only authentication, an attempt to assign the ApplicationImpersonation role, which is required for data restore with Veeam Explorer for Microsoft Exchange, fails with the following error:

Microsoft.Exchange.Management.RbacTasks.ManagementRoleDeprecatedException
Error: deprecated; The management role "ApplicationImpersonation" is in the process of being deprecated. New role assignments referring this role aren't allowed.

Microsoft is retiring the ApplicationImpersonation RBAC (Role-Based Action Control) role in Exchange Online. Retirement began in September 2024, and the role is expected to be removed entirely in February 2025. This change was announced in the Microsoft Message Center (post MC724116) and the Exchange Team Blog on February 20, 2024.

Starting in Veeam Backup for Microsoft 365 v7a P20240418 (build 7.1.0.2031), Exchange Online data can be restored using modern certificate-based authentication, which does not require the assignment of the ApplicationImpersonation role.