China Restricts U.S. Investment in Tech Sector

Chinese regulators have begun restricting U.S. investment in the country's technology sector, requiring government approval for funding in sensitive areas such as artificial intelligence, following Meta's acquisition of a prominent AI startup last year.

The National Development and Reform Commission, a key state planning agency, has instructed several private tech firms to reject U.S. capital in recent funding rounds unless explicitly cleared by authorities, according to people familiar with the matter. This multiagency effort, which includes the Ministry of Commerce, aims to prevent American investors from acquiring stakes in technologies vital to national security. Among the companies receiving such guidance are AI startups Moonshot AI and StepFun, while ByteDance, the parent of TikTok, has been directed not to permit secondary share sales to U.S. investors without regulatory permission.

The measures stem from heightened scrutiny over Meta's more than $2 billion purchase of Manus, announced in December 2025. Manus, a Singapore-incorporated general AI agent capable of automating tasks like financial analysis and sales drafting, was founded by Chinese nationals and initially...