Facebook will stop allowing publishers and people in Australia to read or share news content on the platform, it has said.
The announcement comes in response to proposed new laws in Australia that would force tech companies to negotiate with media companies over how much to pay them for news content.
Facebook initially threatened to pull news content in August, early in discussions surrounding the proposed new Media Bargaining law.
But the decision to impose the ban comes as legislation is set to be debated in parliament ahead of being voted into law.
Within an hour of the announcement, The Sydney Morning Herald's stories posted on their Facebook page had been removed. (Photo / Facebook)
Facebook Australia & New Zealand managing director William Easton defended the shock call in a lengthy statement.
"The proposed law fundamentally misunderstands the relationship between our platform and publishers who use it to share news content," he wrote.
"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 discussion involving the proposed law centred on American-based tech firms such as Facebook, and how they benefited from news being shared on their platforms.
But Easton argued that Facebook's platforms "have fundamentally different relationships with news".
"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," he said, claiming the arrangement worked in publishers' favour.
"Last year Facebook generated approximately 5.1 billion free referrals to Australian publishers worth an estimated AU$407 million," he posted.
"For Facebook, the business gain from news is minimal. News makes up less than 4 per cent of the content people see in 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."
Daily Mail Australia's content on Facebook has been removed. (Photo / Facebook)
Less than an hour after the announcement, Facebook had pulled content from Australian media site's Facebook pages.
But late last year, the Australian Competition and Consumer Commission slammed the then-threat to ban news in Australia.
"The draft media bargaining code aims to ensure Australian news businesses, including independent, community and regional media, can get a seat at the table for fair negotiations with Facebook and Google," ACCC chairman Rod Sims said in a statement at the time.
"Facebook already pays some media for news content. The code simply aims to bring fairness and transparency to Facebook and Google's relationships with Australian news media businesses."