Does country A have any right to dictate what company B does in country C, just because company B operates in country A? Many of us say no, because that will only cause a downward spiral to make the internet the lowest common denominator of all countries that are connected.
Also note that country A absolutely can decide what terms upon which company B is allowed to operate in country A. This is true even of them stating what company B can and can't do in country C. If company B wants to do something in country C that company A prohibits, company B needs to decide whether it wants to operate in country A and follow country A's laws, or leave country A so it can do what it wants in country C.
The Internet is by design, and should be, decentralized. The "lowest common denominator" effect is an unfortunate side effect of centralized entities like Google trying to cater to everyone. But Google is the problem, exempting them from the law is hardly the solution. Smaller, localized providers will be able to better meet the needs of a given population's culture and laws, and address the unique problems associated with any given locality.
Yes, that does mean that the Internet won't look the same to everyone everywhere in the world, but that isn't a bad thing. Facebook in Myanmar is a great example that just because a website can be available globally doesn't mean it should. These global entities are not capable of understanding the impact they have on a macro or micro scale on that scope.
Every piece of the Internet, every server, computer, router, and switch, is in one country or another (barring the few floating out in international waters), and every single one of them is subject to the law in the country where it is. And every individual or business entity operating them is subject to the laws in the countries they are or operate in. This has always been this way.
The Internet is not any different than any other communication medium. We don't perceive a phone call as being something above or outside the law of the nation it takes place in. We don't see mail as being above or outside the law of the nations it traverses. The Internet is just another medium of communication between people and businesses like any other.