We have an exchange online retention policy applied to retain content forever. Strangely, this policy also affects SharePoint sites even though they are not part of the target locations in retention policy.
I check the status of the policy via PowerShell and output shows that SharePointLocation field is blank.
But when I try to delete a folder in SharePoint, it throws the error that all items inside folder should be deleted before you can delete the folder, which is common when there is a retention policy applied to that site.
I contacted MS support and this is the reply I received:
This answer does not make much sense to me and am not able to find any documentation on this side effect anywhere. Anyone has any tips or guidance on this?