Your tenant has been identified as having existing users using external forwarding prior to September 1st 2020, and for this reason the “Automatic” setting will default to “on”, i.e. Update October 30, 2020: Microsoft has now communicated the following in the message center (for my tenant): As a follow up to MC221113 (August 28th), on September 1st, 2020 the Auto-Forwarding Policy will be enforced for tenants who have configured their policy to “On” or “Off”, this includes tenants that had users external forwarding prior to September 1st 2020. This week Microsoft announced through the message center (MC220853) they are rolling out the External Email Forwarding Controls functionality for customers with Office 365 Advanced Threat Protection (ATP) licensed. In February this year I blogged about Stopping automatic email forwarding in your Exchange Online environment in a controlled way providing a structural way to disable automatic email forwarding within your organization, while still allowing exceptions.
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