the file would be uploaded to whatever the temp folder is on your server/host.
The error that you are getting. After the file is uploaded ACF does a json_decode() on the contents. This returns null if there is something wrong with the json in the file. The only thing I can think of is that the file is somehow being altered during the upload process, maybe something to do with the host.
Try uploading the file to your media library if it will let you and then compare it to the original.
