"We have clear rules against hate speech and work hard to keep it off our platform", a Facebook spokesperson said in a statement.
Technology companies have come under increased scrutiny worldwide over how they police their sites amid the rise of fake news, possible terrorist propaganda and far-right rhetoric online.
For example, Twitter has removed just 1% of flagged content, while Facebook has removed 39%. "The biggest problem is that the social networks do not take the complaints of their own users seriously enough", he said.
'This will set binding standards for how companies running social networks must handle complaints and require them to delete criminal content'.
According to a law proposed Tuesday by German Justice Minister Heiko Maas, social media sites would be required to staff 24-hour helplines that would respond to user complaints flagging criminal content.
Tuesday's announcement comes after a warning past year from justice minister Heiko Maas that the government would monitor how social media companies were dealing with increasing hate crime as well as with deleting illegal content on their respective platforms - and would intervene if their response was deemed inadequate.More news: Little warm on ban on unvaccinated kids
Social media firms such as Twitter and Facebook were getting better at handling illegal content, said Mr Maas, but both had a long way to go. Justice Minister Heiko Maas said the measures, which will become part of a bill to be adopted by German lawmakers in the coming months, would not restrict freedom of speech.
Facebook said it would examine the proposal.
It added that it was working with the government to tackle the issue.
It said its own tests showed a higher rate of content removal than the figures cited by the German justice ministry and that it would meet its obligations under German law.
"By the end of the year over 700 people will be working on content review for Facebook in Berlin".
Due to its Nazi past, Germany bans public Holocaust denial and any overt promotion of racism.
Robert Singer, the chief executive of the World Jewish Congress, praised the proposal. He declared: "The internet is awash with hateful content, a lot of which is illegal incitement to hatred and violence". This could include libel, hate crime, and threats.