China's National Development and Reform Commission has ordered Meta to unwind its $2 billion acquisition of Manus, a Singapore-based AI startup that was originally founded in China. The state planner said the decision was made in accordance with existing laws and asked both parties to withdraw the transaction. Meta announced plans to buy Manus in December 2025, intending to fold the startup's AI agents into products like its Meta AI assistant. A Meta spokesperson previously told CNBC the deal "complied fully with applicable law."
Manus builds general-purpose AI agents that handle tasks including market research, coding, and data analysis. The company launched its first agent in March 2025 and hit $100 million in annual recurring revenue just eight months later. It raised $75 million from Benchmark in April 2025. But Manus started in China before relocating to Singapore, and Beijing considers the underlying technology a domestic asset subject to export controls.
The stakes extend beyond one deal. China's Ministry of Commerce opened an investigation in January, examining whether the acquisition violated export control and overseas investment rules. In March, Manus co-founders Xiao Hong and Ji Yichao were summoned to Beijing for talks with regulators and barred from leaving the country, according to five sources familiar with the matter. The message to other Chinese AI founders considering a move offshore is blunt: relocating your company doesn't sever Beijing's reach.
For the AI agent space, the constraints are real. Manus hit $100M ARR in eight months, and Meta wanted it badly enough to pay $2 billion. Now that deal is dead, and the founders can't leave China. The Invisible Blast Radius of agent failure looms larger for everyone involved.