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Mohamed Bin Hammam has had his lifetime Fifa ban annulled by the Court of Arbitration for Sport (CAS).
The ruling by CAS will cause huge embarrassment to Fifa, whose ethics committee imposed the lifetime ban for bribery one year ago.
It is understood that while the Qatari has not been proven innocent by CAS the appeal has been upheld on the grounds of a lack of evidence.
Fifa can bring fresh proceedings against Bin Hammam if the revamped ethics committee has any new evidence.
Bin Hammam was found guilty by Fifa's ethics committee last year of paying bribes to Caribbean officials while campaigning against Sepp Blatter for the Fifa presidency.
Bin Hammam had been president of the Asian Football Confederation and he was provisionally suspended by that governing body earlier this week.
That followed an audit by PricewaterhouseCoopers that centred on contract negotiations and payments to and from AFC bank accounts during Bin Hammam's presidency.
He was alleged to have breached a number of AFC regulations including relating to gifts and bribery. Sources close to Bin Hammam say the allegations are further attempts to tarnish his name.
Bin Hammam always claimed the Fifa action against him was retribution for having challenged Blatter for the presidency.
It is almost a year to the day since Fifa's ethics committee found 63-year-old Bin Hammam guilty of conspiring to pay bribes and issued the lifetime ban.
Bin Hammam had been a growing force in international football and displayed his power by being influential in Qatar's runaway victory in the contest to host the 2022 World Cup.
Some observers had believed he was on course to defeat Blatter until, less than a month before the election, he was accused of paying around 1million US dollars to officials from 25 Caribbean nations.
Witnesses testified that after being addressed by Bin Hammam at a specially-arranged meeting in Trinidad, officials were invited to pick up cash gifts of 40,000 US dollars per association contained in brown envelopes.
The witnesses stated that former Fifa vice-president Jack Warner had told officials the money had come from Bin Hammam. Warner resigned from Fifa a month later and refused to speak to investigators.
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