A lawyer for Eugene Rwamucyo, who was arrested in May under a 2006 international warrant issued at Rwanda's request, said he had been released from custody.
Rwamucyo denies any involvement in the 100-day massacre in Rwanda, in which an estimated 800,000 ethnic Tutsis and politically moderate Hutus were killed by Hutu militia and soldiers.
"The appeal court at Versailles has rejected the extradition request by Rwanda, which puts an end to the process," said his lawyer, Philippe Meilhac. "It is the usual motive ... the lack of the right to legitimate defence in Rwanda today."
Meilhac said Rwamucyo planned to return to Belgium, where he moved after being suspended from his job in a French hospital last year after a nurse found his name on the Interpol website, listing his alleged offences as "genocide, war crimes".
However, Rwamucyo still faces an investigation opened in 2008 by French prosecutors and his lawyer said he would return to face questioning. "There is no question of fleeing," he said.
Two French judges travelled to Rwanda last week to resume an investigation into the 1994 assassination of former Hutu President Juvenal Habyarimana, which unleashed the genocide.
The previous judge in charge of the investigation, Jean-Louis Bruguiere, provoked a break in diplomatic relations between France and Rwanda in 2006 by issuing nine arrest warrants for close associates of President Paul Kagame. Relations were reestablished last year.
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