ORA-01031 on CREATE/ALTER USER under sysdba account

If you have the following error with user operations (CREATE USER, ALTER USER etc)

SQL> connect / as sysdba
Connected.
SQL> create user c##common identified by c##common;
create user c##common identified by c##common
                                    *
ERROR at line 1:
ORA-01031: insufficient privileges

check if Database Vault is enabled.

SELECT VALUE FROM V$OPTION WHERE PARAMETER = 'Oracle Database Vault';

After you enable Oracle Database Vault, you no longer can use the
administrative accounts (such as SYS and SYSTEM) to create or enable
user accounts.
Disabling database Vault is version specific. For example in 12c if you forgot password for accounts with DV_ACCTMGR role the only way is to recreate database.