China’s investigation into Meta’s acquisition of AI startup Manus reflects a broader shift in global technology governance, where advanced AI agents, models, and intellectual property are increasingly treated as matters of national strategy rather than commercial innovation.

Meta’s push to expand its artificial intelligence capabilities has run directly into geopolitical reality. Last month, the U.S. technology giant acquired Manus, a Singapore-based startup specializing in AI agents, in a deal valued by sources at more than $2 billion. This week, China’s Ministry of Commerce confirmed it will conduct a formal review of the acquisition to assess compliance with Chinese laws on export controls, cross-border technology transfers, and overseas investment.

While the transaction does not involve a Chinese buyer, Beijing’s response underscores how origin, intellectual lineage, and early-stage development now matter as much as corporate headquarters when it comes to advanced AI.

From Beijing to Singapore: Manus’ complex origin story

Manus did not begin life as a Singaporean company. The project originated inside Butterfly Effect, a Chinese startup also known as Monica.Im, before being spun out and relocated to Singapore earlier this year. That move coincided with the launch in March of Manus’ first AI agent, designed to assist with market research, coding, and data analysis.

The product quickly attracted attention in China’s tech circles, where it was described by some observers as a potential “new DeepSeek,” a comparison that reflects both technical ambition and national sensitivity. According to available information, Manus later laid off most of its Beijing-based staff in July as it prepared for global expansion, while maintaining teams in Singapore, Tokyo, and San Francisco.

By December, the company reported 105 employees across those locations and disclosed that its annual recurring revenue had exceeded $100 million just eight months after launch. Manus claimed this made it the fastest startup globally to reach that milestone from zero, a statement that highlights why the company drew interest from a buyer like Meta.

Why Meta wanted Manus — and why China is paying attention

Meta has been explicit about its intentions. In a statement released in December, the company said Manus would help it build “universal agents” for both consumer-facing and enterprise products, including Meta AI. This aligns with Meta’s broader strategy of embedding automation and AI-driven assistance across its ecosystem.

From a commercial perspective, the acquisition fits a clear pattern. Large U.S. tech firms are racing to internalize AI agent capabilities rather than rely on external platforms. AI agents promise not just smarter chat interfaces, but autonomous systems capable of executing complex tasks across software environments.

For China, however, the issue is not Meta’s product roadmap. It is the strategic value of the underlying technology. By launching a formal investigation, Beijing is signaling that it views advanced AI agents and related intellectual property as assets with national security implications, even when the acquiring company is foreign and the target is legally based outside China.

Regulation as leverage, not necessarily prohibition

China’s Ministry of Commerce emphasized that it supports cross-border technology cooperation, provided it complies with existing laws and regulations. That framing is deliberate. According to analysts, the most likely outcome is not an outright ban on the deal, but a prolonged approval process and potential restrictions on how Manus’ technology can be used or transferred.

Such conditions could include limits on deploying models developed in China, constraints on data flows, or requirements around intellectual property handling. Even without blocking the acquisition, these measures would give Beijing leverage in a high-profile, U.S.-led transaction.

This approach fits a broader regulatory pattern. Rather than abrupt prohibitions, China increasingly relies on procedural reviews and compliance requirements to shape outcomes in strategically sensitive sectors.

AI agents as a new fault line in global tech competition

The Manus case illustrates how the focus of tech geopolitics is shifting. Earlier tensions centered on hardware, semiconductors, and manufacturing capacity. Today, attention is moving toward software agents, autonomous systems, and the intellectual frameworks that allow AI to act rather than merely respond.

That shift complicates the idea of “neutral” innovation hubs. Even when a startup relocates, restructures, or globalizes its workforce, the origin of its core technology can remain politically relevant. For multinational companies like Meta, this creates a more fragmented landscape in which acquisitions carry regulatory risk well beyond traditional antitrust review.

China’s investigation into Meta’s acquisition of Manus is less about one deal than about precedent. It reflects a world in which AI agents are no longer seen as just productivity tools, but as strategic capabilities worth monitoring, negotiating over, and, if necessary, constraining.

For Meta, the outcome will shape how quickly and freely it can integrate Manus’ technology into its products. For the broader tech industry, the message is clearer still: in the era of advanced AI, global expansion no longer guarantees regulatory simplicity.

By Claire Whitmore 
January 08, 2026

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