From https://en.wikipedia.org/wiki/Side-by-side_assembly#Example_manifest

Manifests are typically a section embedded in the application's executable file but may also be an external file. When the operating system loads the application and detects the presence of a manifest, the operating system DLL loader is directed to the version of the DLL corresponding to that listed in the manifest. If there is no manifest, the DLL loader loads a default version of all DLL dependencies. If the DLL is a COM server, it must have a manifest of its own for registration-free activation to succeed.