Installing Windows 11 on MacBook Air M4 with parallells 18 fails

Im trying to install Windows 11, but both when asking Parallels to do it for me, and if I download the ISO (ARM) manually, Parallels seems to fail. The same thing happens to my colleague.

This is the message that pops up:
"Make sure that the specified file is a valid Parallels virtual machine configuration file and it is not corrupt, or select another file."

I also get this message:
"Cannot register this virtual machine due to an ID conflict."