China is moving to limit American investments in the technology sector

Bloomberg News reported on Friday that China intends to restrict major technology companies, including leading emerging companies in the field of artificial intelligence, from accepting American investments without government approval.

The report cited by the agency, citing informed sources, indicated that Chinese regulatory bodies, including the National Development and Reform Commission, recently issued instructions to a number of private technology companies to reject American investments in financing rounds without explicitly approving them.

The report stated that Moonshot AI and StepFun, startups in the field of artificial intelligence, were among the companies that received these directives. The report added that regulatory bodies also decided to impose similar restrictions on ByteDance, which owns the TikTok application, and do not want the company to agree to sell secondary shares to American investors without government approval.

Bloomberg reported that these measures aim to prevent American investors from obtaining shares in sensitive technologies linked to Chinese national security.

NDRC, StepFan, ByteDance, Mita and Moonshot AI have not yet responded to Reuters’ requests for comment.

There has been no response yet from the US Treasury Department or the US Department of Commerce office.

The Chinese embassy in Washington said it was not aware of this issue.

This heightened scrutiny comes in the wake of Meta’s acquisition of artificial intelligence startup Manos for more than $2 billion in 2025, which led to investigations into foreign investments in Chinese companies and technology exports amid fears that the deal would prompt other startups to move advanced technology abroad.

American capital has played an important role for years in the Chinese technology sector, from companies such as Sequoia Capital and Benchmark injecting venture capital to deep operating relationships that include companies such as Apple, Microsoft and Tesla.

US pension funds and endowments were major supporters of China-focused investment funds, which helped boost growth across internet platforms, electric cars, and artificial intelligence.

Washington imposed its own restrictions earlier this year, limiting American investments in some Chinese companies working in the fields of artificial intelligence, semiconductors, and Chinese quantum technology, citing security concerns.