In 1999 eBay was under heavy fire for allowing the sale of Nazi memorabilia. Their policy approach at the time mirrors almost exactly what Facebook is doing now with Holocaust denial groups, namely banning behavior in certain countries to comply with local laws, but allowing it everywhere else.
From a 1999 New York Times article: “eBay…said that the company already prohibited the sale of such items in Germany because they are outlawed there. But he said it generally polices the sales of banned items only after receiving complaints from users”
From a PCMag article in May 2009 on Facebook: “We have recently begun to block content by IP in countries where that content is illegal, including Nazi-related and Holocaust denial content in certain European countries,” the Facebook spokesman said. “The groups in question have been blocked in the appropriate countries.”
Part of the balancing act eBay uses when making a decision on a listing is to ban items which “lack substantial social, artistic, or political value.” It goes on to state “this includes items that may be deemed inappropriate or insensitive to victims of natural disasters or human tragedies.”
Facebook doesn't want to be the last reasonable entity standing on the wrong side of the Holocaust denial issue. But it's sure looking like that's how this is going to play out.