Unicode server permits only unicode enabled clients. - Internationalization and Localization

Problem: Unicode clients require a unicode enabled server.

If P4CHARSET is set in the client , but the service is not operating in internationalized mode, the service returns the following error message:

Unicode clients require a unicode enabled server.

Solution:
For Perforce services operating in the default (non-Unicode mode), P4CHARSET must be left unset (or set to none) on user workstations.P4CHARSET only affects files of type unicode and utf16; non-unicode files are never translated.

Example:

c:\p4\project\>p4 edit startbuild
Unicode clients require a unicode enabled server.
c:\p4\project>set P4CHARSET=none
c:\p4\project>p4 edit startbuild
//project/startbuild#1 - opened for edit


For Perforce services operating in Unicode mode, P4CHARSET must be set on user machines. If P4CHARSET is unset, but the service is operating in Unicode mode, Perforce applications return the following error message:
Unicode server permits only unicode enabled clients.

c:\p4\project\>set P4CHARSET=UTF-8
c:\p4\project\>p4 edit startbuild
Character set must be one of:
none, utf8, utf8-bom, iso8859-1, shiftjis, eucjp, iso8859-15,
iso8859-5, macosroman, winansi, koi8-r, cp949, cp1251,
utf16, utf16-nobom, utf16le, utf16le-bom, utf16be,
utf16be-bom, utf32, utf32-nobom, utf32le, utf32le-bom, utf32be,
or utf32be-bom
Check P4CHARSET and your '-C' option.
c:\p4\project\>set P4CHARSET=utf8

For further information refer
http://www.perforce.com/perforce/r12.2/manuals/cmdref/env.P4CHARSET.html
http://kb.perforce.com/article/66/internationalization-and-localization
http://cygwin.com/cygwin-ug-net/setup-locale.html