{"id":39800,"date":"2026-03-28T03:20:37","date_gmt":"2026-03-27T19:20:37","guid":{"rendered":"https:\/\/sgbuzz.com\/?p=39800"},"modified":"2026-03-28T03:20:37","modified_gmt":"2026-03-27T19:20:37","slug":"beijings-surprise-intervention-on-metas-manus-renews-debates-on-china-shedding","status":"publish","type":"post","link":"https:\/\/sgbuzz.com\/?p=39800","title":{"rendered":"Beijing&#8217;s surprise intervention on Meta&#8217;s Manus renews debates on &#8216;China shedding&#8217;"},"content":{"rendered":"<p><br \/>\n<\/p>\n<div id=\"RegularArticle-ArticleBody-5\" data-module=\"ArticleBody\" data-test=\"articleBody-2\" data-analytics=\"RegularArticle-articleBody-5-2\"><span class=\"HighlightShare-hidden\" style=\"top:0;left:0\"\/><\/p>\n<div class=\"InlineImage-imageEmbed\" id=\"ArticleBody-InlineImage-108268327\" data-test=\"InlineImage\">\n<div class=\"InlineImage-wrapper\">\n<div>\n<p>CHONGQING, CHINA &#8211; JANUARY 07: In this photo illustration, the Manus logo is displayed on a smartphone screen, with the Chinese national flag visible in the background, on January 7, 2026 in Chongqing, China. <\/p>\n<p>Cheng Xin | Getty Images News | Getty Images <\/p>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>Tech circles from Silicon Valley to Shenzhen buzzed when <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-1\"><a href=\"https:\/\/www.cnbc.com\/quotes\/META\/\" target=\"_blank\" rel=\"noopener\">Meta<\/a><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span> acquired Manus, a Singaporean AI startup with Chinese roots, for $2 billion late last year.<\/p>\n<p>For Chinese founders striving to build products that could rival American peers, the deal felt like a validation that an intricate offshore structure \u2013 known as &#8220;Singapore washing&#8221; where companies relocate to the city state \u2013 was the answer to circumvent scrutiny from both Beijing and Washington.\u00a0<\/p>\n<p>Within days, China&#8217;s surprise intervention on the deal quickly shattered that hope, as Beijing stepped up efforts to discourage Chinese AI founders from moving business offshore.\u00a0<\/p>\n<p>The Chinese government started reviewing whether Manus&#8217; sale had violated laws governing technology exports and outbound investment, and barred co-founders Xiao Hong and Ji Yichao from leaving China for Singapore, according to a <a href=\"https:\/\/www.ft.com\/content\/d9123d9d-c807-41d6-8a17-80ff1111834a?syn-25a6b1a6=1\" target=\"_blank\" rel=\"noopener\">Financial Times report<\/a> earlier this week.<\/p>\n<p>Founded in China, Manus relocated its headquarters and core teams to Singapore last year, allowing it to access deeper capital pools from foreign investors, including the San Francisco-based <a href=\"https:\/\/www.bloomberg.com\/news\/articles\/2025-04-25\/chinese-ai-startup-manus-scores-funding-at-500-million-value\" target=\"_blank\" rel=\"noopener\">venture capital firm Benchmark<\/a>.\u00a0The company captivated Silicon Valley with an AI agent capable of building websites and executing basic coding tasks independently. <\/p>\n<p>But that investment drew fire in mid-2025 from lawmakers in the U.S. who have prohibited American investors from backing Chinese AI companies directly.<\/p>\n<p>The broadening review by the Chinese government fueled concerns and confusion among a generation of Chinese tech founders and venture capitalists that had quietly embraced the so-called &#8220;Singapore-washing&#8221; model, forcing a reckoning as the U.S.-China tech rivalry deepens.<\/p>\n<\/div>\n<h2 class=\"ArticleBody-subtitle\"><a id=\"headline0\"\/>The model that no longer works<\/h2>\n<div class=\"group\">\n<p>&#8220;The path taken by Manus: people will not go down that route anymore,&#8221; Wayne Shiong, managing partner of Argo Venture Partners, a Silicon Valley-based seed investor in AI. <\/p>\n<p>More founders are now looking to start outside China from &#8220;day one,&#8221; before any meaningful research and development is done in China, rather than attempting a structural pivot mid-growth, Shiong told CNBC.<\/p>\n<p>&#8220;Founders eyeing global expansion and higher valuations would still see the upside of having backers in the U.S.,&#8221; Shiong added. Valuations for Chinese AI startups tend to be <a href=\"https:\/\/www.cnbc.com\/2025\/11\/26\/cnbc-china-connection-newsletter-capital-ai-sector-valuations-vc-us-bubble-nvidia-deepseek-chatgpt.html\" target=\"_blank\" rel=\"noopener\">a fraction of their U.S. peers<\/a>.\u00a0<\/p>\n<p>The Manus deal came as the U.S.-China rivalry in the AI space intensified, and the competition has increasingly been defined not just by access to advanced chips but also by the flow of talent and technology. <\/p>\n<p>Yuan Cao, a Beijing-based lawyer at Yingke law firm, said it was &#8220;a red flag for Beijing&#8221; for companies to develop technology in China in their early days before &#8220;transferring assets to an overseas entity through a restructuring.&#8221;\u00a0<\/p>\n<\/div>\n<div role=\"region\" aria-labelledby=\"Placeholder-ArticleBody-Video-108246887\">\n<div role=\"button\" tabindex=\"0\" id=\"Placeholder-ArticleBody-Video-108246887\" class=\"PlaceHolder-wrapper\" data-vilynx-id=\"7000399553\" data-test=\"VideoPlaceHolder\">\n<div class=\"InlineVideo-videoEmbed\" id=\"InlineVideo-0\" data-test=\"InlineVideo\">\n<div class=\"InlineVideo-wrapper\">\n<div class=\"InlineVideo-inlineThumbnailContainer\"><img decoding=\"async\" class=\"InlineVideo-videoThumbnail\" src=\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/108246888-17671286231767128620-43248228984-1080pnbcnews.jpg?v=1767128622&amp;w=750&amp;h=422&amp;vtcrop=y\" alt=\"Meta buys Manus to scale AI agents across its platform\"\/><span class=\"InlineVideo-videoButton\"\/><span\/><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>In cases like this, &#8220;where you build your product matters more than where the holding company is registered,&#8221; Cao said.<\/p>\n<p>Matthias Hendrichs, a Singapore-based adviser to global AI firms, said that &#8220;&#8216;Singapore-washing,&#8217; or simply setting up a legal entity locally and hiring a handful of local staff, is nowhere near sufficient.&#8221;<\/p>\n<p>&#8220;The entire team needs to relocate, the customer base must be transitioned, and early Chinese investors will typically need to exit their positions,&#8221; Hendrichs said.\u00a0<\/p>\n<p>The Manus deal also served as a wake-up call for tech investors betting that offshore structures can protect promising Chinese startups from Beijing&#8217;s reach.\u00a0<\/p>\n<p>Chinese authorities would &#8220;look past the Singaporean facade and dig into the root of the company, including the codes, data and talents,&#8221; said Alex Ma, managing partner at Singapore-based family office Alpha Omega Holdings.<\/p>\n<p>But Beijing also may not want to &#8220;over-punish success&#8221; as it would discourage founders and distort incentives,&#8221; said Ma, who remained positive that companies would continue to find new compliance pathways in the wake of the Manus episode.\u00a0<\/p>\n<\/div>\n<h2 class=\"ArticleBody-subtitle\"><a id=\"headline1\"\/>What&#8217;s next?\u00a0<\/h2>\n<div class=\"group\">\n<p>It remains unclear what further action the Chinese government will take in addition to the exit bans on the founders, and whether it will order Meta-Manus to unwind the transaction.\u00a0\u00a0\u00a0<\/p>\n<p>While Beijing pressed ahead with its review, the deal was completed with more than 100 Manus employees having moved into Meta&#8217;s Singapore office in early March, according to people familiar with the matter.\u00a0<\/p>\n<p>In an emailed response to CNBC, a Meta spokesperson said &#8220;the transaction complied fully with applicable law. We anticipate an appropriate resolution to the inquiry.&#8221; China&#8217;s Foreign Ministry, Chinese Embassy in Singapore, and Manus did not respond to requests for comment.<\/p>\n<p>Should Beijing want to unwind the deal, it would be &#8220;very tricky&#8221; for Meta as the U.S. tech giant rushed to integrate Manus amid cutthroat competition in the space, said Hendrichs.\u00a0<\/p>\n<p>Even for startups incorporated outside China from inception, Beijing&#8217;s action has added another layer of uncertainty to an already opaque regulatory system.\u00a0<\/p>\n<\/div>\n<div role=\"region\" aria-labelledby=\"Placeholder-ArticleBody-Video-108254662\">\n<div role=\"button\" tabindex=\"0\" id=\"Placeholder-ArticleBody-Video-108254662\" class=\"PlaceHolder-wrapper\" data-vilynx-id=\"7000401334\" data-test=\"VideoPlaceHolder\">\n<div class=\"InlineVideo-videoEmbed\" id=\"InlineVideo-0\" data-test=\"InlineVideo\">\n<div class=\"InlineVideo-wrapper\">\n<div class=\"InlineVideo-inlineThumbnailContainer\"><img decoding=\"async\" class=\"InlineVideo-videoThumbnail\" src=\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/107405795-1713972773743-gettyimages-1975542608-109a8827_foivv0mb.jpeg?v=1768955857&amp;w=750&amp;h=422&amp;vtcrop=y\" alt=\"Meta's struggle to win over AI enterprise customers\"\/><span class=\"InlineVideo-videoButton\"\/><span\/><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>Among the unanswered gray areas was whether outsourcing work to China-based teams constitutes a technology export violation. Outsourcing has been common among overseas Chinese tech founders, for benefits including cost savings and tapping into the country&#8217;s deep and affordable technical talent pool.\u00a0<\/p>\n<p>China&#8217;s cyberspace regulator has <a href=\"https:\/\/www.reuters.com\/technology\/china-issues-draft-guidelines-standardising-ai-industry-2024-01-17\/\" target=\"_blank\" rel=\"noopener\">raced to regulate <\/a>the rapidly growing field in recent years, but struggled to stay ahead of a technology that is advancing faster than the rules designed to govern it.\u00a0<\/p>\n<p>Sometimes clarity arrives only when a case becomes prominent enough to prompt the government&#8217;s attention, said Allen Wang, co-founder of Cognitio Labs, a Singapore-based AI startup. The Chinese founder started the company earlier this year in Singapore after residing in the city-state for over 10 years.\u00a0<\/p>\n<p>When asked about whether outsourcing to China would be an option for his company, Wang was direct: &#8220;you never know until you get big enough.&#8221; <\/p>\n<\/div>\n<div class=\"ArticleBody-googlePreferredSourceContainer\" data-module=\"GooglePreferredSource\" data-id=\"RegularArticle-GooglePreferredSource-5\"><a href=\"https:\/\/www.google.com\/preferences\/source?q=https:\/\/www.cnbc.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.<\/a><\/div>\n<\/div>\n<p><br \/>\n<br \/><a href=\"https:\/\/www.cnbc.com\/2026\/03\/27\/meta-manus-china-review-singapore-washing-model-regulation-.html\" target=\"_blank\" rel=\"noopener\">Read Full Article At Source <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>CHONGQING, CHINA &#8211; JANUARY 07: In this photo illustration, the Manus logo is displayed on a smartphone screen, with the Chinese national flag visible in&#8230;<\/p>\n","protected":false},"author":1,"featured_media":39801,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[2611],"tags":[],"class_list":["post-39800","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buzz-headlines","wpcat-2611-id"],"_links":{"self":[{"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/posts\/39800","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=39800"}],"version-history":[{"count":0,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/posts\/39800\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/media\/39801"}],"wp:attachment":[{"href":"https:\/\/sgbuzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=39800"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=39800"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=39800"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}