That is wrong. Merely, NetzDG imposes an obligation on specific social network providers to establish an "effective and transparent process" to deal with complaints about unlawful content. Without prescribing a specific process in itself, it specifies certain functional requirements. Among them, this process has to ensure that "blatantly illegal content" is being removed within 24 hours, unless the social network provider has agreed on a longer timespan with the law enforcement agency.
Any fines the NetzDG stipulates do only refer to failures to meet requirements of process design. In no case there are fines for social media providers in the case of wrongfully consider a piece of content lawful in a specific case.
It seems to me that this whole discussion is fundamentally unable to consider these legal nuances. Also, blaming NetzDG for actions of authoritarian governments is just plain silly.
I had a look once at the form in one of Meta services to report hate speech: it does require some effort to fill the form and it does require the issue to be reported to police. If you don’t want to report the case to authorities, the platform will not take down the content. I do not see how this could result in a real censorship in a state with the rule of law.
https://www.techdirt.com/2018/01/12/second-time-week-german-...
https://www.dw.com/en/facebook-slammed-for-censoring-german-...
Fortunately for the defenders of that law, the notoriously opaque censorship of social media companies helps hide what is going on, so few examples surface. I could not find anything as convenient as a list of (wrongfully or not) censored content by this law. Often the censored party is not even told that the NetzDG was involved.
Silence on this issue should not be confused with a lack of problems, however. For example, in Germany:
“it can be a criminal offense in Germany to call another person a ‘jerk,’ or even to use the informal du, or ‘thou,’” to communicate a lack of respect for the recipient. German courts have penalized other similar “derogatory epithets,” including “asshole,” “bastard,” “old goat, “fathead,” “dope,” and “whore.” [..] German courts heard 26,757 criminal insult cases that year, leading to 21,454 convictions and 20,390 fines. - https://law.yale.edu/mfia/case-disclosed/germanys-netzdg-and...
To me this looks like a severe overreach of speech restrictions, even if one doesn't idealize the US 1st amendment, and accepts the need for some government censorship. Yet I've only learned about it just now, from a very obscure post.
Unlabeled satire posted context-free to Twitter where it gets interpreted at true and repeated, is a different complicated problem (and why Twitter is a fundementally terrible design).
But you still have a point in so far as that you can't look at a law ignoring the legal conventions and processes of the environment where "the code is run", something that would be perfectly fine in one environment could be terrible in another.
Try to defended those instead.
(Yes, no fine is levied if the content is not taken down, and turns out to not be illegal. What sane company will take such a risk?)