Yes, Facebook could do that. There's probably many laws in many other countries Facebook operates in that are a lot less reasonable than this one, but I guess if for some reason this was the specific hill they wanted to die on, they would absolutely be free to do so.

Facebook also has a pretty big engineering office in Tel-Aviv, which they'd probably have to close in this scenario. I imagine that would also be a massive PITA. But, again, there's nothing technically stopping them from doing that.