You are running perl -p which by default processes each line in isolation, therefore your regex will never match because you don't have a line with both an opening and closing brace on it, for example.

You could change the line-ender to null to switch this behaviour off:

$ perl -lp0e 's/A\s*\{.+?\}//s' <<EOX
> A {
>   B 123
>   C xyz
> }
> EOX
[download]

This gives the empty output as you initially expected.

Update: See the discussion in the follow-up question Oneliner replace in-place adds extra spaces at the end of the file particularly in regards to the use of -l and how the order of these options is important.