Chinese authorities summoned Manus co‑founders Xiao Hong and Ji Yichao to Beijing and restricted them from leaving as regulators opened a multi‑agency review of Meta’s planned $2.5bn purchase. The National Development and Reform Commission and the Ministry of Commerce are probing whether moving Manus staff and know‑how offshore amounted to an export that required approval.

Regulators step in after staff and operations move Chinese authorities intervened after Manus — an AI agent developer founded by Chinese nationals but incorporated in Singapore — shifted much of its China‑based team and operations offshore ahead of the sale to Meta Platforms. Officials summoned Manus co‑founders Xiao Hong and Ji Yichao to a meeting in Beijing with the National Development and Reform Commission (NDRC) and instructed the executives not to leave China while the review is under way. Meta announced the acquisition earlier this year; the deal has been variously valued at about $2.5bn. Meta has said the start‑up will end its services in China and that there will be no continuing Chinese ownership interest once the transaction closes. Beijing’s review has paused any straightforward closing, turning what was meant to be a quick technology buy into a test case for cross‑border AI deals. Why Beijing is scrutinising the deal The probe is focused on two linked concerns: whether the relocation of Manus staff and assets to Singapore counts as an export of strategic technology, and whether the change of ownership amounts to an unacceptable transfer of operational know‑how. Chinese regulators have been explicit in treating teams, training data, models and day‑to‑day engineering practices as types of technology that can flow across borders — not just tradable products. That framing matters. When the asset being sold is a team and the systems they run, regulators say the usual rules governing exports may apply. Investigators from the NDRC and the Ministry of Commerce are examining whether the moves around Manus required export licences under Chinese law. If they conclude licences were needed and not obtained, the sale could be blocked or subject to conditions. Part of a wider shift on foreign capital and AI Officials’ action on Manus hasn't happened in isolation. Over recent weeks Beijing has quietly instructed a number of top AI companies to seek government clearance before accepting U.S. capital. The guidance has reportedly been relayed to firms including Moonshot AI and StepFun; ByteDance has been told secondary share sales involving U.S. investors would require prior sign‑off. Regulators are also rethinking the role of so‑called red chip structures — offshore vehicles that have long let Chinese firms access foreign capital and markets. Those moves are being coordinated with other measures aimed at keeping advanced technology within Chinese control. Some companies are now unwinding overseas entities or postponing foreign listings to comply with tighter rules. StepFun, for example, is reported to be reorganising its offshore structure as it considers a Hong Kong float, a process that could carry tax and operational consequences. How the Manus case raises legal and practical questions The Manus sale highlights a knot of legal questions that regulators are only beginning to resolve. What counts as an export when the commodity is a trained model, a team of engineers, or a workflow? How should authorities weigh a company’s legal registration in Singapore against its operational roots in China? And what obligations do buyers have to ensure services are wound down inside China as part of an overseas acquisition? As regulators weigh these questions, the Manus review will test how Beijing applies export and ownership rules to AI firms with cross‑border operations.

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Regulators have ordered the co‑founders to remain in China while the NDRC and the Ministry of Commerce decide whether export licences were required — a determination that could block the sale or lead to conditions on any deal.

This article was created with AI assistance.