China’s top economic planning body, the National Development and Reform Commission (NDRC), has formally blocked Meta’s acquisition of the AI startup Manus and ordered all parties to withdraw from the transaction, according to multiple sources, including the Associated Press and TechCrunch.
What Happened
The NDRC issued a statement directing both Meta and Manus to unwind the deal, which was valued at around $2 billion, without further elaboration on its reasoning, as reported by TechCrunch and Bloomberg.
According to the Associated Press, the prohibition stems from concerns about the transfer of advanced technology out of China, as the startup traces its roots to the mainland despite its relocation to Singapore.
Background & Context
Meta announced the acquisition of Manus in December 2025, aiming to integrate the startup’s autonomous AI agent technology into its AI offerings, including Meta AI. Manus was founded by Chinese engineers and relocated its headquarters to Singapore prior to the deal, a move seen by some observers as an attempt at "Singapore‑washing."
In early 2026, Chinese authorities began reviewing the deal under foreign investment and national security scrutiny, including imposing exit bans on Manus’s co‑founders while the probe was ongoing.
Why It Matters
This decision underscores the growing geopolitical friction in AI and cross‑border tech transactions. It demonstrates China’s readiness to intervene post‑transaction to preserve control over homegrown AI innovations. Industry observers view it as a potential deterrent to future acquisitions of tech companies with Chinese heritage by U.S. firms.
What Comes Next
It remains uncertain how Meta can unwind a transaction that has already progressed operationally. Manus employees have already begun integrating with Meta’s teams, and capital has likely changed hands.
Meta has stated that the transaction complied fully with applicable law and said it anticipates an appropriate resolution to the inquiry.
Conclusion
China’s abrupt blockage of Meta’s Manus deal highlights the increasingly contested nature of AI technologies and cross‑border investment. As geopolitical tensions intensify, multinational tech firms must account for regulatory risk in strategic M&A—especially when foreign‑founded but China‑connected startups are involved.