China moves to restrict US investment in tech firms over security concerns
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China is planning to curb US investment in its top technology companies, including artificial intelligence startups, by requiring government approval for such funding.
According to a Bloomberg News report, Chinese regulators, including the National Development and Reform Commission, have instructed several private tech firms to reject US capital in funding rounds unless explicitly cleared by authorities. The move is aimed at limiting foreign stakes in technologies considered sensitive to national security.
AI startups Moonshot AI and StepFun were among those that received the guidance. ByteDance, the parent company of TikTok, has also reportedly been told not to allow secondary share sales to US investors without approval.
The restrictions reflect growing scrutiny over cross-border investments as tensions between the United States and China continue. Chinese authorities are seeking to prevent US investors from gaining influence in sectors linked to advanced technologies.
Several organisations, including the NDRC, the Chinese Embassy in Washington, StepFun, ByteDance, Meta, and Moonshot AI, did not immediately respond to the move. US agencies such as the Department of the Treasury and the Department of Commerce’s Bureau also did not comment.
The increased oversight follows Meta’s acquisition of AI startup Manus in 2025 for more than $2 billion, which triggered investigations into foreign investments in Chinese firms and concerns over potential technology transfers abroad.
US capital has long played a key role in China’s technology sector, with investments from firms like Sequoia Capital and Benchmark, as well as partnerships involving companies such as Apple, Microsoft, and Tesla.
The move comes as Washington has also tightened its own rules, restricting US investment in certain Chinese firms working in AI, semiconductors, and quantum computing on national security grounds.