Comment 6 for bug 1878713

Damn, okay. Looks like it's picking up libs from outside the venv, but I don't really know enough about layer-basic venv handling to give you any quick suggestions.

That error looks very similar to the one you originally reported in https://bugs.launchpad.net/charm-docker/+bug/1862109, so maybe you can manually upgrade setuptools in the venv again to get unstuck.