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Hmm…I think Object versioning answer is more correct.
1. The wording is “to meet regulatory compliance by retaining ..blah ….blah”, it specifically says meet compliance by meeting a certain condition (archiving). But it doesn’t say do other things with compliance (like NOT delete file)
2. Also, preserving previous state is a requirement if new version is uploaded. It doesn’t say PREVENT uploading a new version to meet compliance.
I think the answer should be Object Versioning and not Object Lock with compliance.
Let me know your thoughts.