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China expands curbs on foreign deals, tech transfer after Meta-Manus block
The rules add approval requirements for restricted technology and data transfers and could force companies to rethink cross-border staffing and training deals.
On Monday, China's State Council issued sweeping rules tightening control over overseas transactions involving technology, data, and national security, effective July 1.
These regulations follow Beijing's recent order forcing Meta to unwind its acquisition of Manus, a case authorities cited as a reference point for scrutinizing foreign control over Chinese-developed AI capabilities.
New rules specifically ban cross-border talent transfers without approval, targeting practices like "Singapore-washing," as investors "shall not transfer goods, technologies, services and related data" through indirect arrangements.
Global investors face heightened compliance risks under the new regime, which includes provisions allowing Beijing to ban foreign entities from trading with China if their home countries restrict Chinese investment.
Companies must now reassess how they structure overseas operations and technology licensing, as this development positions China to draw a firmer line around the movement of technology beyond its borders.
The Chinese Government has published a new regulation which, despite granting independent decision-making, provides for investigations and sanctions for transfers of assets affecting national security.