China’s National Development and Reform Commission (NDRC) on April 27 ordered Meta to unwind its over $2 billion acquisition of Manus, a Singapore-incorporated artificial intelligence (AI) agent startup that Chinese founders built in Beijing. The block effectively ends the “Singapore-washing” model, where founders relocate to Singapore to sidestep US-China regulatory scrutiny, and signals that Beijing claims jurisdiction over AI companies based on where founders built them, not where they incorporate.
What happened:
- Meta announced over $2 billion acquisition of Manus in December 2025, stating that “there will be no continuing Chinese ownership interests in Manus AI following the transaction.” China’s commerce ministry launched a review in January 2026, examining whether the deal violated technology export and outbound investment laws.
- Regulators focused specifically on whether Manus transferred its core AI agent intellectual property to its Singapore entity without the government approvals required under China’s Regulations on Technology Import and Export Administration. Beijing-based lawyer Yuan Cao put the legal position plainly: “Where you build your product matters more than where the holding company is registered.”
- In March 2026, NDRC officials summoned Manus chief executive Xiao Hong and chief scientist Ji Yichao to Beijing and barred them from leaving the country, a direct enforcement tool that signals how seriously Beijing treats intellectual property (IP) transfer reviews.
- On April 27, the NDRC issued its formal block, stating it had decided “in accordance with the law to prohibit foreign investment in the acquisition of the Manus project.” It did not name Meta. Meta, however, said the transaction “complied fully with applicable law.”
Why Beijing acted now: US export controls restricted Huawei to 200,000 AI chips in 2024, against Nvidia’s one million downgraded H20 chips sold to China alone that year. Washington also banned DeepSeek from US government devices in March 2025, restricting Chinese AI software alongside hardware. Beijing has mirrored this: China banned US chips from government computers in 2024. The Manus block is Beijing’s symmetrical counter, controlling the models and talent Chinese founders built the same way Washington controls the chips China needs to build AI.
The regulatory framework behind the block: The block relies on Decree 835, issued on April 13 with immediate effect and no grace period. The Regulations on Countering Foreign Improper Extraterritorial Jurisdiction assert China’s right to exercise jurisdiction over conduct with an “appropriate connection” to China.
This undefined standard gives Beijing wide discretion: a company does not need to operate in China for authorities to assert jurisdiction over its decisions. While the NDRC did not cite a specific provision in its block statement, the April decrees form the broader legal…
Source link
Disclaimer
We strive to uphold the highest ethical standards in all of our reporting and coverage. We blogs.grocliq.com want to be transparent with our readers about any potential conflicts of interest that may arise in our work. It’s possible that some of the investors we feature may have connections to other businesses, including competitors or companies we write about. However, we want to assure our readers that this will not have any impact on the integrity or impartiality of our reporting. We are committed to delivering accurate, unbiased news and information to our audience, and we will continue to uphold our ethics and principles in all of our work. Thank you for your trust and support.
Website Upgradation is going on for any glitch kindly connect at [email protected]
