I'm hitting the identical issue with a NEPacketTunnelProvider system extension on macOS 26.2 (25C56), Apple M1 Pro, Xcode 26.4. Developer ID signed, app in /Applications, no quarantine, no MDM. Context: I'm building a WireGuard-based VPN client. The app was previously working as an app extension (.appex with packet-tunnel-provider entitlement). I migrated to the system extension model for Developer ID distribution — .systemextension bundle in Contents/Library/SystemExtensions/, CFBundlePackageType SYSX, Mach-O MH_EXECUTE, NEProviderClasses in Info.plist, systemextensionsctl developer on. I've verified: App runs from /Applications (confirmed via ps aux) No com.apple.quarantine xattr Developer ID Application signing on both app and extension, same certificate, same team (verified via codesign -dvvv) Correct entitlements: com.apple.developer.system-extension.install on host app, packet-tunnel-provider-systemextension on both embedded.provisionprofile present in both app and extension PkgInfo contains SY