When Vole opened an advanced research lab in Beijing in 1998, it was a time of hope for tech and China. The company hired hundreds of boffins for the lab, which led Microsoft’s work in speech, image and facial recognition and the kind of artificial intelligence that later made online chatbots likeChatGPT.

The Beijing lab became one of the most important AI labs in the world. Bill Gates, Microsoft’s co-founder, called it a chance to tap China’s “deep pool of brainy talent.”

But as tensions between the United States and China have risen over which country will lead the world’s tech future, Microsoft’s top bosses -- including Satya Nadella, its chief executive, and Brad Smith, its president -- have argued what to do with the prized lab for at least the past year.

The company has faced questions from US officials over whether keeping a 200-person advanced tech lab in China is doable, the people said.

Microsoft said it had put guardrails at the lab, stopping researchers from politically dodgy work. The company, which is based in Redmond, Wash., said it had also opened a branch of the lab in Vancouver, British Columbia, and would move some researchers from China to the place.

 The branch is a backup if more researchers need to move, two people said. The idea of shutting down or moving the lab has come up, but Microsoft’s leaders favour keeping it in China.

Microsoft Research Peter Lee said: “We are as committed as ever to the lab and the top-notch research of this team. There has been no talk or push to close Microsoft Research Asia, and we look forward to carrying on our research plan.”