Video report by ITV News Global Security Editor Rohit Kachroo
The social media giant, along with Google, is locked in a battle with the Australian government over proposed laws in the country to make digital giants pay for journalism.
Australian politicians are considering forcing digital businesses to reach paid-for-news agreements with media companies with draft legislation that could create a so-called News Media Bargaining Code.
The code would create an arbitration panel to set a binding price for news in situations where Google and Facebook do not reach deals with media businesses whose original journalism they link to.
Both platforms have condemned the proposed laws an unworkable and in response, Facebook announced earlier on Wednesday that it has stopped all Australian news publishers from posting on its site and no user of the website in Australia or globally can share from a news publisher in the country.
International users outside Australia also cannot share Australian news.
ITV News Global Security Editor Rohit Kachroo explains the latest developments
William Easton, managing director at Facebook Australia & New Zealand, wrote on the company’s website on Wednesday: “In response to Australia’s proposed new Media Bargaining law, Facebook will restrict publishers and people in Australia from sharing or viewing Australian and international news content.
“The proposed law fundamentally misunderstands the relationship between our platform and publishers who use it to share news content.
“It has left us facing a stark choice: attempt to comply with a law that ignores the realities of this relationship, or stop allowing news content on our services in Australia. With a heavy heart, we are choosing the latter.”
The announcement comes a day after Australia’s treasurer Josh Frydenberg described as “very promising” negotiations between Facebook and Google with Australian media companies.
Google has also threatened to remove its search engine from the country.
Media giant News Corp has already announced it has struck a deal for Google to pay it for news.
Mr Easton said Facebook and other US technology businesses like Google have “fundamentally different relationships with news”.
He added: “Google Search is inextricably intertwined with news and publishers do not voluntarily provide their content.
“On the other hand, publishers willingly choose to post news on Facebook, as it allows them to sell more subscriptions, grow their audiences and increase advertising revenue.”
Last year Facebook generated around £227 million “free referrals” to Australian publishers, Mr Easton claimed.
He said the social media giant receives a “minimal” business gain from news, which makes up less than 4% of content users see on their news feed.
“Journalism is important to a democratic society, which is why we build dedicated, free tools to support news organisations around the world in innovating their content for online audiences,” he said.
Mr Easton claimed the proposed legislation seeks to “penalise” Facebook for “content it didn’t take or ask for”.
He said the company is prepared to launch Facebook News in Australia to “significantly increase our investments with local publishers”, but would only do so “with the right rules in place”.
Facebook News, the social network’s new section dedicated to personalised news content, launched in the UK last month, allowing users to see curated news stories from major national, local and lifestyle media outlets.
Facebook is paying publishers for their content, with input coming from media outlets such as Channel 4 News, Daily Mail Group, DC Thomson, Financial Times, Sky News and Telegraph Media Group.