China has moved to block Meta's acquisition of the artificial intelligence startup Manus, ordering the deal to be unwound in what appears to be the first publicly disclosed case of Beijing formally prohibiting a foreign investment under its national security review mechanism. China's National Development and Reform Commission (NDRC) announced on Monday that it had issued a prohibition decision against the acquisition, without explicitly naming Meta, and instructed the parties involved to reverse the transaction.

Meta, the California-based social media and technology giant, acquired Manus — an AI agent startup capable of autonomously carrying out complex tasks such as web searches, coding, and data analysis — for approximately $2 billion, announced in December last year. Manus was founded by Chinese programmer Xiao Hong and is technically based in Singapore, where its parent company, Butterfly Effect, reincorporated after relocating from Beijing in mid-2025. The move was designed to distance the company from Chinese regulatory reach and bypass US restrictions on investments in Chinese AI firms — a manoeuvre critics have dubbed