© Getty ImagesFacebook is one of the social media companies affected by NetzDG
Sites that do not remove "obviously illegal" posts could face fines of up to 50m euro (£44.3m).
The law gives the networks 24 hours to act after they have been told about law-breaking material.
Social networks and media sites with more than two million members will fall under the law's provisions.
Facebook, Twitter and YouTube will be the law's main focus but it is also likely to be applied to Reddit, Tumblr and Russian social network VK. Other sites such as Vimeo and Flickr could also be caught up in its provisions.
Act faster
The Netzwerkdurchsetzungsgesetz (NetzDG) law was passed at the end of June 2017 and came into force in early October.
The social networks were given until the end of 2017 to prepare themselves for the arrival of NetzDG.
The call to police social media sites more effectively arose after several high-profile cases in which fake news and racist material was being spread via the German arms of prominent social media firms.
Germany's justice ministry said it would make forms available on its site, which concerned citizens could use to report content that violates NetzDG or has not been taken down in time.
As well as forcing social media firms to act quickly, NetzDG requires them to put in place a comprehensive complaints structure so that posts can quickly be reported to staff.
© Getty Images
Facebook has reportedly recruited several hundred staff in Germany to deal with reports about content that breaks the NetzDG and to do a better job of monitoring what people post.
The law has been controversial in Germany with some saying it could lead to inadvertent censorship or curtail free speech.
The German law is the most extreme example of efforts by governments and regulators to rein in social media firms. Many of them have come under much greater scrutiny this year as information about how they are used to spread propaganda and other sensitive material has come to light.
In the UK, politicians have been sharply critical of social sites, calling them a "disgrace" and saying they were "shamefully far" from doing a good job of policing hate speech and other offensive content.
The European Commission also published guidelines calling on social media sites to act faster to spot and remove hateful content.
Comment: The problem with these kinds of hate speech laws is the vague wording which allow almost anything to be interpreted as hate speech. It follows that content critical of the official narrative will be the first to be considered as such. By forcing these companies to remove content on the basis of a user complaint with no chance to investigate will only lead to further censorship. If you think things are bad now, these kinds of draconian measures will make it worse. See also: