A new rev of the Great Firewall of China seeks out VPN connections (including, I assume, connections over The Onion Router) and terminates them. Only companies who register official VPNs with the Chinese government will be able to run them without interference. Registration is only available to Chinese companies, and I'll bet it involves escrowing your keys with the Chinese net-cops so they can spy on it.
Users in China suspected in May 2011 that the government there was trying to disrupt VPN use, and now VPN providers have begun to notice the effects.
Astrill, a VPN provider for users inside and outside China, has emailed its users to warn them that the "Great Firewall" system is blocking at least four of the common protocols used by VPNs, which means that they don't function. "This GFW update makes a lot of harm to business in China," the email says. "We believe [the] China censorship minister is a smart man … and this blockage will be removed and things will go back to normal."
But the company added that trying to stay ahead of the censors is a "cat-and-mouse game" – although it is working on a new system that it hopes will let it stay ahead of the detection system.