China has officially blocked Meta’s acquisition of the AI startup Manus, ordering all parties to withdraw from the deal. On April 27, the country’s National Development and Reform Commission (NDRC)—through its foreign investment review office—issued a terse statement prohibiting the cross-border acquisition and requiring reversal of the transaction, in accordance with Chinese laws and regulations, as reported by the Associated Press and AP News.
Background of the Deal
Meta had announced the acquisition of Manus in December 2025, in what was described as a rare case of a major U.S. tech company buying an AI firm with strong Chinese roots, despite its Singapore-based headquarters, according to AP. Manus, founded by Chinese engineers and initially domiciled in China before relocating, developed a general-purpose AI agent capable of autonomously executing complex tasks such as coding, market research, and budgeting, per AP and TechRepublic.
Regulatory Rationale and Unwinding the Deal
In a one-sentence declaration, the NDRC demanded that the deal be unwound, citing compliance with domestic legal frameworks without naming Meta explicitly, AP News and The Guardian report. The move followed an earlier review launched in January, when Chinese regulators began scrutinizing the transaction under export-control and technology transfer laws, per TechRadar and Washington Post.
Implications and Industry Reaction
This marks one of the most assertive instances where Beijing has reversed an already announced foreign acquisition, underscoring the growing view of AI technologies as strategic assets warranting state control, The Washington Post notes. Industry analysts interpret the ruling as a clear signal that China is tightening oversight of outbound tech transfers amid escalating U.S.–China competition in artificial intelligence, AP and TechCrunch highlight.
Meta’s Response
Meta stated that the transaction "complied fully with applicable law" and expressed anticipation of a suitable resolution to the inquiry, according to statements cited by AP News and TechCrunch. The company had intended to integrate Manus’s agent technology into its broader AI strategy, but how Meta would navigate unravelling the deal—especially with personnel and IP already transferred—remains unclear.
Conclusion
The NDRC’s decision to block and unwind the Manus acquisition serves as a potent reminder that AI-related deals involving Chinese-linked entities face heightened geopolitical and regulatory sensitivity. This case may prompt multinational tech firms to reassess cross-border AI acquisition strategies and underscores the broader national security frame increasingly applied to AI investments.