China’s National Development and Reform Commission ordered Meta to unwind its $2 billion purchase of Singapore‑based AI startup Manus. The state planner said the move follows existing laws on foreign investment and asked both parties to cancel the transaction. Meta’s shares ticked higher in early trading, but the regulatory hurdle leaves the deal in limbo and may trigger further regulatory reviews.

Manus began in China before re‑incorporating in Singapore to sidestep scrutiny from Beijing and Washington. Its platform builds general‑purpose AI agents capable of market research, coding and data analysis, and it hit $100 million in annual recurring revenue just eight months after launch. The company raised $75 million from Benchmark in April 2023, positioning it as a fast‑growing contender in the generative‑AI space and attracted interest from global investors.

U.S. lawmakers have barred American investors from backing Chinese AI firms, while Beijing has intensified efforts to prevent founders from exporting talent and technology. The blockage of this high‑profile acquisition sends a clear signal that the “Singapore‑washing” route is no longer safe for Chinese AI startups. With the NDRC order in force, the purchase cannot proceed until a formal appeal is filed.