I'm about to create a RMAN catalog database for my setup, what are the general precautions or major pre-requisites as in DB parameters, compatibility,etc that I should take care while creating the catalog database?

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1 - Make sure Recovery Catalog DB is created either on a different server or a different disk (because in case of failure of target DB and lost of access to its files, if your recovery catalog db stills up and running, you'll have access to control file and probably be able to restore and recover failed instances, given all backups/ archivelogs are available.

2 - Follow the Recovery Catalog 3 step creation: - Create the recovery catalog owner/schema, tablespace. (It's noteworthy that sys can't be the rec cat owner) - create the recovery catalog - register the target databases

3 - Regarding compatibility, in order to check recover catalog version, connect to the recovery catalog db through sqlplus and issue: - SELECT * FROM rcver; (if there are multiple lines displayed, the highest will be the current catalog schema version)

4 - Configure control file autobackup to ON (this is always a best practice, with or without Reco Catalog) - Don't use another reco catalog, or things can get really messed. - Run reco catalog db in archivelog, because it will contain very important information about registered db, and you'll sure want recover if needed.

5 - Backup your Recovery Catalog and set proper retention policies to meet your requirements.

Hope it helps.

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