China has formally blocked Meta's acquisition of Manus, an AI company founded by Chinese entrepreneurs, marking a significant escalation in the ongoing tech rivalry between the US and China. The Chinese government ordered Meta to reverse the $2 billion deal on April 27, citing national security concerns.
National Security Takes Precedent
The decision comes after months of scrutiny by Chinese regulators, who began reviewing the acquisition in January 2026. During the investigation, the two co-founders of Manus were instructed not to leave China. This move underscores the increasing difficulty for US and Chinese tech companies to navigate cross-border deals as both nations tighten controls over critical technologies.
Manus’s AI agent, designed to assist users with tasks like booking travel or searching for real estate, relies on multiple AI sub-agents to execute and verify actions.
AI Advancements Under Scrutiny
Manus launched in March 2025 with its "general AI agent," which integrates Anthropic’s Claude 3.7 Sonnet model to perform complex tasks. The system employs a planner agent to assign tasks and an executor agent capable of browsing websites, creating spreadsheets, and even coding new applications. Despite its innovative technology, the acquisition has been sidelined by geopolitical tensions.
This development highlights the growing divide in AI development and investment between the US and China, with Washington accusing Beijing of seeking technological dominance through restrictive policies and unfair trade practices.