China bars founders of AI agent Manus from leaving country following Meta acquisition

Two co-founders of Manus AI, one of the first successful AI agents capable of operating without human intervention, have been barred from leaving China as the country reviews its $2 billion sale to Meta.

The Financial Times reported that Manus’ chief executive Xiao Hong and chief scientist Ji Yichao were summoned to a meeting with China’s National Development and Reform Commission earlier this month where they were questioned over potential breaches of the country’s foreign direct investment rules related to its onshore entities.

No charges have been filed against the pair, and they are not under formal investigation, but people close to the matter said they are currently unable to leave the country pending review.

Manus was developed in China, but moved its operations to Singapore prior to Meta’s acquisition. Senior figures in China are reportedly concerned that the move bypassed domestic legislation in a way that could encourage other companies to follow suit, according to the Financial Times.

Shein, one of the world’s largest fast fashion retailers, similarly relocated to the city state in 2022 for regulatory and financial reasons.

Should Manus be found in breach, penalties could range from fines to the unwinding of the deal. The latter would be “messy”, as Meta has already begun integrating the agent into its software, a person close to the matter told the Financial Times.

China’s foreign direct investment laws are among the strictest in the world; any takeover in a sector the state deems “important” can trigger a governmental review, and it has broad powers to block or otherwise intervene in such transactions.