China Restricts U.S. Investment in Tech and AI Firms

The National Development and Reform Commission and other Chinese regulators have restricted top technology firms and artificial intelligence startups from accepting U.S. capital without explicit government approval. This policy targets high-profile companies including ByteDance, Moonshot AI, and StepFun, specifically curbing funding rounds and secondary share sales to U.S. investors to safeguard sensitive technologies linked to national security.

This regulatory shift follows a multi-agency probe into the offshore migration of advanced technology and illegal foreign investment. The investigation was triggered by the 2025 acquisition of the AI startup Manus by Meta Platforms for over $2 billion. The Ministry of Commerce is among the agencies involved in the probe.

In response to these requirements, firms like StepFun are onshoring capital to comply with the new rules. This move mirrors previous U.S. restrictions on investments in Chinese semiconductor and quantum firms, signaling a deepening divide in the global venture backing of the technology sector.