From "The Glory of the Chinese" to the Regulatory Storm: What Will Be the Future of Manus?

When Manus announced its acquisition by Meta for 2 billion USD, the entire Chinese entrepreneurial community was once abuzz. Many excitedly regarded it as a “perfect path”: Chinese team, overseas migration, acquisition by a top giant — as if validating a standard template for Chinese startups going global.

A few days later, a regulatory notice from the Eastern superpower’s authorities cast a cold shower. This move to tighten control was like pulling the rug out from under everyone, causing a chilling effect.

Biteye has summarized 6 questions, attempting to clarify some core contradictions exposed here:

1️⃣ Are there similar cases in history? China’s use of official review to intervene in commercial activities is common in Web2. Well-known examples like Didi Chuxing, Ant Financial, and ByteDance have all faced scrutiny. The outcomes of these reviews not only affected IPOs, mergers, and acquisitions but also had a certain impact on business operations and users.

2️⃣ What are the possible outcomes of the review? There are three potential results:

1. Conditional approval (most likely) The review may not escalate to an official investigation, but Beijing could leverage this to demand “structural reforms” of the acquisition.
2. Indefinite delay (moderately likely) “Supplementary materials” cycle begins, with no clear indication of violation or approval, using time as a bargaining chip.
3. Transaction prohibition (less likely) A clear ruling that the technology export violates regulations, forcing Meta to abandon the acquisition or restructure as a pure “technology licensing” model, which could trigger a chain reaction of global tech companies being forced to “take sides.”

3️⃣ Does the nationality of the founders matter? Founder Xiao Hong is Chinese, and has not confirmed renouncing his nationality, giving Beijing jurisdiction. China’s export control laws cover natural persons; Xiao Hong’s passport status implies he and his team could face personal liabilities, such as travel restrictions or criminal accountability. This also reinforces the narrative that “technology originates from China,” allowing Beijing to claim IP development in Beijing and Wuhan, viewing transfers as violations.

4️⃣ How is technological property rights recognized? By mid-2025, Manus will shut down services in China and relocate all staff to Singapore. However, under Chinese law, early R&D is considered domestic intellectual property, including patents, software copyrights, and trade secrets. Even if Meta claims to acquire only the Singapore entity, Beijing can still pursue “substantial transfer” because the core technology source remains domestic.

5️⃣ Does this involve core technology outflow? Manus’s AI Agent technology was developed early in China and may involve restricted AI algorithms. When the team migrates code, it’s akin to an invisible technology export. Although Manus is going overseas, Beijing can still impose fines or criminal liability for violating the “Regulations on the Administration of Technology Import and Export of the People’s Republic of China.”

6️⃣ Does this involve Chinese data? Manus’s early development likely used Chinese user datasets. Once Chinese data is involved, the issue becomes sensitive. The review of “important data” leaving the country is directly based on the Data Security Law. Beijing can argue that initial model training involved Chinese resources, viewing it as an export control issue.

💡Biteye’s view: All under heaven, is it not the king’s land?

Manus named its parent company Butterfly Effect — a prophecy fulfilled.

This butterfly, Manus, flapped its wings twice, stirring up two storms.

It also reminds us: the last laugh is the best.

A grain of sand in the era, falling on an individual, becomes a mountain.

In the US-China AI game, Manus is caught in the middle, feeling bittersweet.

Biteye wishes the Manus team all the best, and hopes every founding team’s wishes come true. ❤