China has told three of its top artificial intelligence firms to reject U.S.-origin capital without government approval, tightening a gate around the country’s fast-moving AI sector after Meta Platforms’ roughly $2 billion purchase of Singapore-based Manus.
The instructions, issued in recent weeks by the National Development and Reform Commission, were given to ByteDance, Moonshot AI and StepFun, according to people familiar with the matter. ByteDance was told to block U.S. secondary share sales without state clearance, while Moonshot AI and StepFun were told to refuse U.S. capital in funding rounds and deals unless regulators approved the money first.
The move lands at a moment when Beijing is treating foreign money in strategic technology less like a source of growth than a channel of risk. Manus, though based in Singapore, has deep Chinese engineering roots, and its deal drew unusually close scrutiny from Beijing, which imposed exit restrictions on its co-founders and reviewed the transaction for possible technology export violations.
The latest guidance also follows a sharper political backdrop in Washington. On Wednesday, White House science director Michael Kratsios accused Chinese entities of running industrial-scale campaigns to extract U.S. AI models, saying foreign firms that build on fragile foundations should have little confidence in the integrity and reliability of the models they produce. The Trump administration has also signaled new enforcement against companies using model distillation, according to reports.
ByteDance is TikTok’s parent and China’s most valuable private startup, which makes any capital restriction there especially sensitive. Moonshot AI is said to be considering a Hong Kong listing, and StepFun is a Tencent-backed startup focused on multimodal and generative AI, both signs that the three firms sit near the center of China’s next wave of AI development.
Beijing may turn the recent instructions into a published regulation in the coming weeks. If it does, the Manus episode will have done more than trigger a single review; it will have helped redraw where China will let foreign capital touch its most closely watched AI companies.
