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In this case, you may do the following:

  1. Verify if your Microsoft/Office 365 plan is supported. You may check Cloud App Security System Requirements.
  2. Check if you have configured group naming rules that may prevent the process from continuing.
    During the Exchange Online (Inline Mode) provisioning process, CAS needs to create two O365 groups  (inbound and outbound) with 'TMCAS Inline' as a name prefix to protect inline target users. You may follow these steps:
    1. Log on to the Exchange Admin Center > Mail Flow > Connectors, and then check if the 'TMCAS Inline' connectors were created.
    2. You may also check the Microsoft Entra ID Audit Logs filtered by Category: GroupManagement and Initiated by (actor): TrendMicro Cloud App Security for Exchange Online (Inline Mode).
    For reference: Connectors, Transport Rules, Groups, and Allow Lists for Inline Protection.
If the issue persists, contact Trend Micro Technical Support.