According to this article, all items in the SharePoint site and Preservation Hold Library will be permanently deleted after three years.
1.If the content is modified or deleted, during the retention period, a copy of the original content as it existed when the retention settings were assigned is created in the Preservation Hold library. Items in the Preservation Hold Library will move to second-stage recycle bin. We no longer permanently delete content from the Preservation Hold library. Instead, we permanently delete content only from the Recycle Bin. Besides, the items in second- stage recycle bin will permanently delete automatically after 93 days.
2.If the content is not modified or deleted, the items with this retention policy will move to first-stage recycle bin. After this event, user can delete items from first-stage recycle bin to second- stage recycle bin. Then after 93 days, the items in second- stage recycle bin will permanently delete automatically.
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