China has blocked Meta's $2 billion (£1.5 billion) acquisition of Manus, a developer of autonomous AI agents, as part of a broader crackdown on US investments in domestic technology companies. The Chinese National Development and Reform Commission (NDRC) announced on Monday that it had cancelled the takeover, ordering both parties to withdraw the transaction.
Regulatory Action
In a statement, China's top economic planning body said it would "prohibit the foreign investment in the acquisition of the Manus project" and "requires the parties involved to withdraw the acquisition transaction." The move comes amid heightened scrutiny of cross-border deals involving US capital.
Bloomberg reported last week that Chinese regulators are planning to block tech firms, including leading AI startups, from accepting US investment without government approval. Several private companies have reportedly been warned in recent weeks that they should reject US funding unless it receives explicit approval from Beijing, a policy shift triggered by the Manus deal.
Background of the Deal
Mark Zuckerberg's Meta, the owner of Facebook, Instagram, and WhatsApp, announced the acquisition of Manus in December. Manus, which launched in Beijing but is now based in Singapore, described the deal as "validation of our pioneering work with general AI agents." AI agents are designed to carry out multiple tasks—such as planning holidays, handling customer queries, or drafting research presentations—without human intervention, making them key products for tech executives touting the labour-saving potential of the technology.
Meta, which is investing billions of dollars into its AI drive, said at the time of the announcement that the acquisition would bring a "leading agent to billions of people and unlock opportunities for businesses across our products."
Meta's Response
Asked to comment on the NDRC decision, Meta stated: "The transaction complied fully with applicable law. We anticipate an appropriate resolution to the inquiry." The company has not indicated whether it will appeal or seek alternative approvals.
Geopolitical Context
China and the United States are the leading AI superpowers, with all of the top 20 best-performing models produced by developers from one of these countries. US President Donald Trump claimed in January that "we're leading China by a tremendous amount" in what the White House has framed as a straight race between Beijing and Washington for AI dominance.
The sudden regulatory action comes weeks before a planned mid-May summit between Trump and Chinese President Xi Jinping in Beijing. China rarely orders corporate deals to be unwound after completion, signaling heightened regulatory scrutiny amid US-China tech competition.
Previous High-Profile Cases
China's request to unwind the Manus deal is the latest high-profile instance of blocking a cross-border transaction. Last year, China criticized billionaire businessman Li Ka-shing's CK Hutchison for agreeing to sell dozens of ports worldwide to a consortium led by US asset manager BlackRock in a $23 billion deal, which was welcomed by Trump.
Manus's Position
Manus was hailed early last year by state media and commentators as China's next DeepSeek—one of the country's leading AI startups—after releasing what it claimed was the world's first general AI agent. However, Manus does not produce its own AI model; instead, it operates an agent framework that runs on top of existing western large-language models.
