Here's the SOAP request and response.  The exception references 
biddingTransition.explicitAdGroupBids which the v201206 documentation says "
BiddingTransition<https://developers.google.com/adwords/api/docs/reference/latest/CampaignService.BiddingTransition>
 no longer requires a default bid via explicitAdGroupBids."

<soap:Envelope xmlns:soap="http://schemas.xmlsoap.org/soap/envelope/"; 
xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance"; 
xmlns:xsd="http://www.w3.org/2001/XMLSchema";>
<soap:Header>
<RequestHeader xmlns="https://adwords.google.com/api/adwords/cm/v201206";>
<authToken>xxx</authToken>
<clientCustomerId>xxx</clientCustomerId>
<developerToken>xxx</developerToken>
</RequestHeader>
</soap:Header>
<soap:Body>
<mutate xmlns="https://adwords.google.com/api/adwords/cm/v201206";>
<operations>
<operator>SET</operator>
<biddingTransition xsi:type="ConversionOptimizerBiddingTransition">
<targetBiddingStrategy xsi:type="ConversionOptimizer">
<conversionOptimizerBidType>MAX_CPA</conversionOptimizerBidType>
</targetBiddingStrategy>
<useSavedBids>true</useSavedBids>
</biddingTransition>
<operand>
<id>83189794</id>
</operand>
</operations>
</mutate>
</soap:Body>
</soap:Envelope>



<soap:Envelope xmlns:soap="http://schemas.xmlsoap.org/soap/envelope/";>
   <soap:Header>
      <ResponseHeader 
xmlns="https://adwords.google.com/api/adwords/cm/v201206";>
         <requestId>0004c4b63cfbe2380aeddb8a0000487f</requestId>
         <serviceName>CampaignService</serviceName>
         <methodName>mutate</methodName>
         <operations>1</operations>
         <responseTime>71</responseTime>
         <units>1</units>
      </ResponseHeader>
   </soap:Header>
   <soap:Body>
      <soap:Fault>
         <faultcode>soap:Server</faultcode>
         
<faultstring>[BiddingTransitionError.EXPLICIT_BID_REQUIRED_FOR_TRANSITION @ 
operations[0].biddingTransition.explicitAdGroupBids]</faultstring>
         <detail>
            <ApiExceptionFault 
xmlns="https://adwords.google.com/api/adwords/cm/v201206";>
               
<message>[BiddingTransitionError.EXPLICIT_BID_REQUIRED_FOR_TRANSITION @ 
operations[0].biddingTransition.explicitAdGroupBids]</message>
               
<ApplicationException.Type>ApiException</ApplicationException.Type>
               <errors xsi:type="BiddingTransitionError" 
xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance";>
                  
<fieldPath>operations[0].biddingTransition.explicitAdGroupBids</fieldPath>
                  <trigger/>
                  
<errorString>BiddingTransitionError.EXPLICIT_BID_REQUIRED_FOR_TRANSITION</errorString>
                  <ApiError.Type>BiddingTransitionError</ApiError.Type>
                  <reason>EXPLICIT_BID_REQUIRED_FOR_TRANSITION</reason>
               </errors>
            </ApiExceptionFault>
         </detail>
      </soap:Fault>
   </soap:Body>
</soap:Envelope>

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