China moves to block Meta’s AI deal with Manus

A cross-border tech deal that once looked like a straightforward expansion of AI capabilities is now turning into a test of how far governments are willing to go to control the flow of talent and technology.

China has stepped in to block the acquisition of AI startup Manus by Meta, signalling a sharper stance on foreign access to companies developing advanced artificial intelligence. The country’s National Development and Reform Commission (NDRC) said it was prohibiting the deal, though it stopped short of naming Meta directly.

The move reflects a broader shift in how Beijing is approaching outbound technology. Where Chinese-founded startups once moved more freely across jurisdictions, they are now increasingly seen as strategic assets — even when headquartered elsewhere.

Manus itself sits in that grey zone. While now based in Singapore, the company has Chinese roots and focuses on general-purpose AI agents capable of handling complex tasks with minimal human input — exactly the kind of frontier technology drawing scrutiny on both sides of the US-China divide.

The NDRC said its decision was made in accordance with Chinese laws and regulations, but did not specify the legal grounds for annulling a deal involving a Singapore-based entity. It also remains unclear how such a transaction, already announced, could be practically unwound.

For Meta, the acquisition was positioned as a way to deepen its AI capabilities across platforms. The company has maintained that it followed all relevant legal frameworks.

“The transaction complied fully with applicable law. We anticipate an appropriate resolution to the inquiry.”

Washington, for its part, framed the situation in more strategic terms, suggesting that interference in US tech deals will be met with resistance.

A White House spokesperson said the administration “will continue defending America’s leading and innovative technology sector against undue foreign interference of any sort”.

The dispute is unfolding against a backdrop of tightening controls on both sides. The US has been working to limit Chinese access to advanced semiconductor technology, while China is increasingly focused on preventing the transfer of domestic innovation — whether through talent, intellectual property or acquisitions.

Meta announced the Manus deal in December, in what was seen as a rare example of a major US technology company acquiring an AI firm with strong links to China. As part of the process, the company said Manus would end its operations in China and eliminate any remaining Chinese ownership ties.

That transition had already begun. After raising $75m in a funding round led by US venture firm Benchmark in May 2025, Manus shut down its China offices and relocated to Singapore.