We have never had a law pertaining to the manufacture of military equipment here in Canada; however, our government strives to get as many offsets and production lisences as possible. Although much of our military uses US-designed equipment, you will find that much of it is made (or at least assembled) in Canada.
Back in the 1950s and 1960s, there was another reason for the Canadian government to lisence build aircraft; it was a good way to help with our commitment to NATO. By building aircraft under lisence, we could help our allies in Europe acquire modern equipment much faster and in greater numbers. Chiefly, Canadair (then a Crown corporation) was responsible for undertaking lisence production.
As for modifications and special equipment, there were many changes made by Canadair, many of which would be applied in turn by the original manufacturer. The CF-104, for example, had a good number of features that were later applied to the F-104G. The same also applies to the CF-5 - features of that aircraft (INS and uprated engines, amongst others) were applied in the F-5E Tiger II
As for the CL
-30 Silver Star (T-33) and the Canadair Sabre, these aircraft were in many ways superior to the original aircraft, especially with regard to engines. The Canadair Sabre Mk 6 had a reputation of being the best performing of all the Sabre variants, as Canadair managed to incorporate the "soft" wing of the F-86F into this aircraft, along with a much more powerful Canadian-designed and built Orenda engine.
Production numbers are as follows:
-30 Silver Star: 656 of all variants
Canadair Sabre: 1815 of all variants
CF-104: 200 as CF-104s (all single-seat models), further 140 as F-104Gs
CF-5: 240 of all models
Of course, I could get into the CP
-107 Argus, the CL
-44s and the North Stars, but that is a different story altogether.