China blocks Meta Manus deal in one of the most significant cross-border tech interventions in recent years, ordering the reversal of Meta’s $2 billion acquisition of AI startup Manus after a months-long probe. The move could reshape competition in the fast-growing AI agents market.
Why China Blocks Meta Manus Deal
China’s National Development and Reform Commission said it had prohibited foreign investment in the Manus project under existing laws and regulations and required both parties to withdraw the transaction.
No further explanation was provided, but the decision represents a major escalation in oversight of foreign acquisitions involving strategic AI companies.
What It Means for Meta’s AI Plans
The blocked acquisition could be a setback for Meta’s push into agentic AI. Manus had been expected to help strengthen Meta’s position in AI agents, software systems designed to complete more advanced tasks with limited human input.
According to the report, Meta planned to integrate Manus technology directly into Meta AI.
Company Operations Already Underway
The situation is complicated by the fact that around 100 Manus employees had already moved into Meta’s Singapore offices by March. The founders also reportedly took executive roles inside the company.
The report said CEO Xiao Hong now reports directly to Meta COO Javier Olivan, while Hong and Chief Scientist Yichao Ji are reportedly under exit bans that prevent them from leaving mainland China.
China Blocks Meta Manus Deal After Startup Relocation
Founded in 2022 by Xiao Hong, Yichao Ji, and Tao Zhang, Manus began in China before relocating its headquarters to Singapore around mid-2025.
Just months later, Meta agreed to acquire the Singapore-based startup for roughly $2 billion to $3 billion, according to the report.
Wider Scrutiny Around Chinese-Linked AI Firms
The report also noted that Manus’ Chinese roots had already attracted attention in Washington. Concerns were raised over whether U.S. capital should flow into companies with links to China.
That means this case goes beyond one transaction and reflects rising global scrutiny around AI ownership, investment, and strategic technology control.
Meta Responds
A Meta spokesperson said the transaction complied fully with applicable law and that the company expects an appropriate resolution to the inquiry.
For now, however, the order to unwind the acquisition leaves the future of the deal uncertain.
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