Meta’s Manus Acquisition Draws Uneven Regulatory Reactions in Washington and Beijing

Meta’s planned $2 billion acquisition of AI assistant platform Manus is facing scrutiny from regulators — but not in the way many initially expected.

In the United States, regulators appear largely comfortable with the transaction, despite earlier concerns surrounding venture capital firm Benchmark and its prior investment in Manus. Chinese regulators, however, are reportedly taking a much closer look, according to reporting by the Financial Times.

Benchmark’s decision to lead a funding round for Manus earlier this year immediately drew attention in Washington. John Cornyn publicly criticised the investment on social media, and the deal prompted inquiries from the U.S. Treasury Department amid the rollout of new rules aimed at limiting American investment in Chinese artificial intelligence companies.

Those concerns were significant enough to influence Manus’ corporate strategy. The company ultimately moved its headquarters from Beijing to Singapore, a transition that one Chinese academic described on WeChat as a “step-by-step disentanglement from China.”

Now, the regulatory pressure appears to be shifting in the opposite direction.

Chinese authorities are reportedly reviewing whether Meta’s acquisition of Manus may violate China’s technology export control laws. In particular, officials are examining whether Manus required an export license when it relocated its core technical team from China to Singapore — a practice that has become common enough to earn the nickname “Singapore washing.”

A recent Wall Street Journal article suggested that Beijing had limited ability to influence the deal because of Manus’s presence in Singapore. However, current regulatory reviews indicate that the assessment may have underestimated China’s leverage.

Officials in Beijing are reportedly concerned that allowing the transaction to proceed without intervention could encourage more Chinese startups to relocate physically overseas to avoid domestic regulatory oversight. Winston Ma, a professor at New York University School of Law and a partner at Dragon Capital, told the Journal that a smooth closing would “create a new path for young AI startups in China.”

There is precedent for Beijing taking action. During Donald Trump’s first term, China used similar export-control mechanisms to push back against the administration’s attempt to ban TikTok. In recent commentary on WeChat, the same Chinese professor warned that Manus’ founders could face criminal liability if restricted technologies were exported without proper authorisation.

Meanwhile, some analysts in the United States view the deal through a very different lens. Several have characterised the acquisition as validating Washington’s investment restrictions, arguing that it demonstrates that Chinese AI talent is increasingly migrating to the U.S. technology ecosystem. One expert told the Financial Times that the transaction shows “the US AI ecosystem is currently more attractive.”

It remains unclear whether the regulatory uncertainty will affect Meta’s plans to integrate Manus’ AI agent software into its products. What is clear, however, is that the $2 billion deal has become more complex — and more geopolitically sensitive — than initially anticipated.