FILE – A meta logo appears on a video screen at LlamaCon 2025, an AI developer conference, on April 29, 2025, in Menlo Park, California.
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Jeff Chiu/AP/AP
HONG KONG – China on Monday blocked the acquisition of artificial intelligence startup Manas by US tech giant Meta. This was an unexpected move to withdraw from an agreement that had clearly raised concerns in Beijing over the transfer of advanced technology.
China’s top planning body, the National Development and Reform Commission, said in a one-line statement that it prohibited any foreign takeover of Manus and called on all parties to withdraw from the deal. He did not specifically name Meta Platforms, which owns Facebook and Instagram.
The decision was made by the commission’s Foreign Investment Security Review Working Mechanism Office in accordance with Chinese laws and regulations, the statement said. This comes after Chinese authorities announced earlier this year that they were considering the deal.
The commission did not elaborate on the reasons for the ban. The announcement comes less than a month before US President Donald Trump’s scheduled visit to Beijing with Chinese leader Xi Jinping in May, and signals that China’s Communist Party leadership is increasing its oversight of the AI industry as geopolitical competition with the US intensifies over technology.
Meta announced in December that it would acquire Singapore-based Manas, which has Chinese roots, in an unusual move for a major U.S. tech group to acquire an AI company with strong ties to China. The deal with Manus was expected to help Meta expand its AI services across its platform, as its “general purpose” AI agents can autonomously perform complex, multi-step tasks.
Meta said that “there is no continued Chinese ownership of Manus” and that Manus would discontinue its services and operations in China. However, China announced in January that it would investigate whether the acquisition complies with its laws and regulations.
China’s Ministry of Commerce said at the time that companies involved in foreign investment, technology exports, data transfers and cross-border acquisitions must comply with Chinese law. Mr Mehta said most of Manus’ employees are based in Singapore.
Manas did not respond to requests for comment. The company’s website states that it is “currently part of Meta,” indicating that the deal has already been completed.
Meta said on Monday that the Manus transaction was “in full compliance with applicable law.”
The California-based company said in a statement that it “looks forward to an appropriate resolution to the investigation.”
Singapore-based Butterfly Effect was the company that backed Manas prior to the acquisition. But the AI startup’s roots go back to a Beijing-registered company founded several years ago.
“China is showing the world that it is willing to take a hard line on AI talent and capabilities, which it views as a core national security asset,” said Lian Jie Su, principal analyst at technology research and advisory group Omdia. “This is a strong indication of what future actions the Chinese authorities may take regarding acquisitions involving Chinese deep tech companies.”
He said the Chinese government’s takeover ban could thwart similar acquisition plans by U.S. tech giants in the future. “In the context of competition, this reflects U.S. export controls, corporate listings, and curbs on investment in China,” Su said.
