Steppenwolf being the quintessential example.
1) Developing its own domestic artists/musicians, to a much greater degree than the US (eg https://www.factor.ca/)
2) Greatly restricting smaller foreign acts (especially from the US) from performing in Canada for commercial purposes
Yes, point #2 also applies to the US, but it's not enforced. But if you cross into Canada with musical instruments, they'll put the fear of God into you.
This is largely why the phenomena you describe exists: artists can develop within their domestic cocoon, without being crowded-out by Americans, and then tour their larger, wealthier neighbor to greatly expand their profile virtually risk-free.
2) Greatly restricting smaller
foreign acts (especially from
the US) from performing in
Canada for commercial purposes
Yes, point #2 also applies to
the US, but it's not enforced.
But if you cross into Canada
with musical instruments,
they'll put the fear of God into
you.
Lots of countries have this quota system where they try to artificially force feed homegrown music, tv shows and movies and it never works.
People always gravitate to the larger American sphere because it doesnt have such restrictions in place. They dont work anyway.
When I first saw Matteo Garrone's Gomorrah (2008) it was so fresh and un-Hollywood like in the presentation of the raw violence and vice, that it stunned me. I still cant stand most PG-fied and Disney-fied American films.
[1] https://en.wikipedia.org/wiki/Gomorrah_(film)
Gomorra (2008) Official HD Trailer [1080p]
IIRC you need to hit 3/4 to be considered Canadian content.
At that time J Biebs was big, but since his music and lyrics were written by Americans and he performed/recorded in the States, his music was not CanCon despite him being Canadian. So, at the radio station I volunteered at, his music would count towards the 30% quota of not-CanCon music.