Veeam Backup & Replication upgrade fails with an error "Database version downgrade detected ... Reboot and restart the setup"

Challenge

The upgrade to Veeam Backup & Replication U4 fails with "Database version downgrade detected ... Reboot and restart the setup". You may find following error in the C:\ProgramData\Veeam\Setup\Temp\BackupSrvLog.log:

***Veeam***  SRV: [31.01.2019 11:39:43]:<00000001> [VEEAM] Database version has been incremented to <5186>
***Veeam***  SRV: [31.01.2019 11:39:43]:<00000001> [VEEAM] Executing version command (ContentType=[Schema], Version=<5186>)
***Veeam***  SRV: [31.01.2019 11:39:43]:<00000001> [VEEAM] Adding trusted hosts (InitialCatalog=[VeeamBackup], DatabaseVersion=<5186>)
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] declare @id uniqueidentifier;
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] set @id = '52107791-e0ff-4538-a26e-4717962aef77';
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] declare @usn bigint;
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] exec IncrementUsn @usn output;
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] BEGIN
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] INSERT INTO [dbo].[Backup.Model.HostSshFingerprint]
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] (
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] [id], [network_name], [accepted_fingerprint], [current_fingerprint], [public_key], [agent_id], [network_name_hash], [last_update_time], [usn]
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] )
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] VALUES  
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] (
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] @id, '<IP Address>', '', '', '', '00000000-0000-0000-0000-000000000000', '', '<Day>/<Month>/Year <time>', @usn
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] )
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] END;
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM] [SQL|ERROR] GO
***Veeam***  SRV: [31.01.2019 11:39:44]:<00000001> [VEEAM|ERROR] Conversion failed when converting date and/or time from character string. (System.Data.SqlClient.SqlException)

Cause

This is a known issue in Veeam Backup & Replication 9.5 U4. There are 2 mandatory conditions for this issue to raise:

1. System time format uses a.m. and p.m. (in small symbols with dots)
2. Application-aware processing, or guest OS file indexing is enabled for a Linux machine.

Affected regional formats and countries are:

English (New Zealand)
Greek (Greece)
Maori (New Zealand)
Spanish (Argentina)
Spanish (Bolivia)
Spanish (Costa Rica)
Spanish (Honduras)
Spanish (Nicaragua)
Spanish (Peru)
Spanish (Puerto Rico)
Spanish (Paraguay)
Spanish (El Salvador)
Spanish (Bolivarian Republic of Venezuela)
Galician (Galician)
Guarani (Paraguay)
K'iche (Guatemala)
Quechua (Bolivia)
Quechua (Peru)
Romanian (Romania)

Solution

In the meantime we suggest using the following workaround before installing the product:

1. Open Control Panel.
2. Click on the Clock, Language, and Region link.
3. Click on the Change date, time, or numbers formats link.
4. Under the Formats tab, click on the Additional settings... button
5. Under the Time tab, please set AM symbol: AM
6. Under the Time tab, please set PM symbol: PM
7. Click Apply.
8. Click OK.
9. Click Apply.
10. Click OK.

If you've already ran into the issue, please uninstall Veeam Backup & Replication, change the Regional format OS settings, and install 9.5 Update 4 pointing setup program to the existing configuration database.