I fail to see how blocking sharing of news links undermined Australia's sovereignty. The Australian government gave Facebook a choice to either pay up or exit the news business and they chose the latter. So they are in compliance with local law.
The News Media Bargaining Code is not yet law, and didn't even pass its final reading until after Facebook enacted their ban, so Facebook was under no legal obligation to block links to news websites. They were in compliance with local law regardless.
What Facebook did was a blatant attempt to influence the legislative process. It was the equivalent of a nation enacting an export ban due to threats of tariffs.
