China has blocked Meta’s planned acquisition of AI startup Manus and ordered the deal to be unwound after a regulatory review raised national security concerns.
The National Development and Reform Commission (NDRC) said it will “prohibit the foreign investment in the acquisition of the Manus project” and “requires the parties involved to withdraw the acquisition transaction”, adding that the decision was taken “in accordance with laws and regulations.”
Meta, the owner of Facebook, agreed in December to acquire Manus, an AI agent startup originally founded in China but later based in Singapore. The deal was seen as a push by Meta to strengthen its artificial intelligence systems for complex, multi-step tasks.
At the time, Meta said the acquisition would “bring a leading agent to billions of people and unlock opportunities for businesses across our products.”
But the transaction quickly drew regulatory attention amid rising US-China technology tensions.
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In March, Chinese authorities also imposed travel restrictions on executives linked to the company. Manus’s chief executive Xiao Hong and chief scientist Ji Yichao were summoned to a meeting with the NDRC in Beijing. After the meeting, the executives, both based in Singapore, were told they cannot leave China during the ongoing regulatory review, though they are permitted to travel within the country.
Manus, developed by startup Butterfly Effect, is an AI agent designed to perform tasks such as summarising documents, analysing resumes, and building websites. It has been described as one of China’s notable advances in AI agent technology.
China’s state news agency Xinhua confirmed the decision, saying the NDRC’s foreign investment review body had formally ordered the cancellation and reversal of the transaction.
Meta has not yet commented on the ruling, while AFP said it had contacted both Meta and Manus for response.