China Blocks Meta’s $2B Manus Acquisition After Regulatory Probe Into AI Deal

China’s top economic regulator, the National Development and Reform Commission (NDRC), has officially blocked Meta’s $2 billion acquisition of the AI startup Manus, bringing a dramatic halt to one of the most closely watched cross-border tech deals of the year. The decision follows months of regulatory scrutiny and marks a major intervention in global artificial intelligence competition.

In a brief statement, the NDRC said it was prohibiting foreign investment in the Manus project and ordering both parties to fully unwind the transaction. No detailed explanation was provided, but the move signals China’s increasingly firm stance on controlling strategic AI-related assets, especially those with domestic origins.

The fallout is significant for Meta, which had been working to strengthen its position in the fast-growing AI agent market. Manus, founded in 2022 by Chinese engineers before relocating to Singapore in 2025, had already begun integrating into Meta’s ecosystem. Reports indicate around 100 employees had transitioned to Meta’s Singapore offices, with senior leadership also taking roles within the company structure.

However, the deal has been complicated by geopolitical and legal concerns. Manus’ leadership has remained under scrutiny in China, with reports suggesting some executives are subject to exit restrictions. Meanwhile, U.S. lawmakers have also raised concerns about the company’s Chinese origins and the implications of American investment flowing into firms with historical ties to China.

Meta has defended the transaction, stating it complied with all applicable laws and expressing confidence in a resolution. Despite that, Manus did not respond to requests for comment, leaving uncertainty over what happens next for the startup, its employees, and Meta’s broader AI ambitions.

source: techcrunch