Application Compatibility action applies the dynamic application of Microsoft Application Compatibility shims to a target application. After analyzing Application Compatibility testing logs and creating an elevation policy using the Adjust Application Compatibility wizard, which creates both the policy and the action, a new Application Compatibility action is created in the Application Compatibility folder.
If you have legacy software running on Windows 7, then you will use the Application Compatibility action to allow that software to work without manual compatibility adjustments.
Related Links
Analyzing Application Compatibility Testing Logs