Meta Manus Acquisition Controversy: The Limits of 'Singapore Washing' in AI Tech

A $2 billion exit just turned into a massive geopolitical trap. As 2026 dawned, Meta announced its acquisition of Manus, a rising star in agentic AI. However, the deal was immediately hit by a probe from China's Ministry of Commerce (MOFCOM). Despite the startup's desperate attempts to rebrand as a Singaporean entity, regulators aren't letting it go so easily.

Meta Manus Acquisition Controversy and Identity Reconstruction

Founded in 2022 by Xiao Hong, Manus's parent company, Butterfly Effect, was originally rooted in Wuhan and Beijing. To chase Silicon Valley capital and avoid scrutiny, the firm executed a lightning-fast 'identity reconstruction.' They shifted their headquarters to Singapore and hived off their Chinese operations. But in the age of AI, you can't just rewrite the history of your code.

When Algorithms Become National Assets

Beijing argues that Manus's intelligence isn't easily uprooted. Since the foundational R&D took place in China, the state views the sale to a foreign giant like Meta as a 'strategic loss.' Under the new 50 percent rule introduced in September 2025, jurisdiction follows the technology, not the registration certificate. If the code was born in China, the state demands a say in its destination.