China has mandated that U.S. investments in its AI startups require government approval, impacting several prominent companies, including Moonshot AI and StepFun. This policy, orchestrated by the National Development and Reform Commission, aims to prevent American capital from entering sectors deemed strategically sensitive, a response to heightened scrutiny following Meta’s acquisition of the Chinese-founded AI startup Manus. The rules reflect a broader pattern of regulatory tightening from both Washington and Beijing, as the U.S. has already imposed restrictions on investments in sensitive Chinese technology sectors. As a result, this new approval requirement could significantly alter funding dynamics for leading AI firms in China.

Meta: Meta Platforms develops social networks, metaverse technologies, and AI tools. Its acquisition of Manus triggered Beijing’s review over potential technology exports via team and know-how transfer.
China: China’s government directs economic planning and strategic technology development through agencies like the NDRC. It recently instructed top AI companies to secure explicit approval before accepting U.S. capital to protect sensitive sectors. This policy responds to concerns over foreign influence in AI amid escalating U.S.-China tech tensions.
Manus: Manus is an AI agent startup founded by Chinese experts, incorporated in Singapore but with deep China operations. Chinese regulators probed its Meta acquisition, framing the transfer of talent and systems as a technology export issue.
StepFun: StepFun is a top Chinese AI startup building models and assistants for Q&A, document analysis, and task execution. It was directed by authorities to obtain approval for U.S. capital and is unwinding offshore structures to comply with listing requirements.
ByteDance: ByteDance operates major platforms including TikTok internationally and is China’s most valuable private tech firm. Regulators informed it that secondary share sales to American investors need prior Beijing approval.
Ji Yichao: Ji Yichao is chief scientist and co-founder of Manus AI. He faces exit restrictions alongside the CEO amid Beijing’s scrutiny of the company’s sale to Meta.
Xiao Hong: Xiao Hong serves as CEO and co-founder of Manus AI. He was summoned by the NDRC and barred from leaving China during the review of the Meta deal.
Moonshot AI: Moonshot AI is a leading Chinese AI lab developing the Kimi series of multimodal agentic models, including the recently open-sourced Kimi K2.6 focused on coding, UI generation, and multi-agent tasks. The company received regulatory guidance requiring government sign-off for any U.S. investments in funding rounds.
National Development and Reform Commission: The National Development and Reform Commission is China’s key agency for macroeconomic planning and oversight of strategic industries. It issued guidance to AI firms on U.S. investment approvals and led the probe into Meta’s Manus acquisition.

Investment Curbs: China’s new rules target U.S. capital in strategically sensitive AI fields following the Meta-Manas deal probe.
Geopolitical Parallel: The policy echoes U.S. restrictions limiting American investments in Chinese AI, semiconductors, and quantum technologies.
Offshore Restructuring: AI firms using red chip structures face blocks on Hong Kong listings, leading companies like StepFun to unwind overseas entities.