I have a similar problem. We are a product migrating towards FileProviderExtension in macOS. I can see that File Provider's also have ways of providing custom actions in context menus (https://developer.apple.com/documentation/fileproviderui/adding_actions_to_the_context_menu). But we already have a Finder Sync Extension that used to do this work - So, naturally we wanted to re use it. But when it watches theCloudStorage path the context menus never show up, but works pretty well on other paths in the filesystem, even on mounted drives. Is this an expected behaviour? That FinderSyncExtensions are restricted in CloudStorage path in favour of File Provider custom actions?

In macOS 11.2.1 A very similar issue with the Office URI Schemes.. $ open "ms-word:ofe|u|https://hostname/dave/24e3ee9b7743978301775c776cb50566/10040WordDocument.docx" The file /Users/tanmay/ms-word:ofe|u|https:/hostname/1/dave/24e3ee9b7743978301775c776cb50566/10040WordDocument.docx does not exist. It works fine in macOS 10.15.7. Is this a bug?? This is mission critical bug for people relying on Office URI schemes, unless there is other way arround.