The court dismissed an original claim of 6.8 million Hong Kong dollars (870,000 US dollars) for damages to replace the wall and said Schwarz was free to leave Hong Kong.
Schwarz's signature style, which he calls liquidation, is a logo covered in wet paint which then drips down the wall creating a bleeding effect.
The Parisian daubed a Chanel logo on to the building in the upmarket Central district in July, although the property is better known as the location of an Armani store.
The building owners have filed a separate civil suit seeking damages, which will be heard at a later date, Schwarz's lawyer Andrew Powner told AFP after the decision.
The early-morning painting session was recorded in a YouTube video and Schwarz wore his trademark mask and yellow jumpsuit.
He was arrested by police a few hours later along with two Hong Kong residents, previous reports have said.
Speaking before Friday's decision, Schwarz said he chose the Armani store because it had "the best wall for exposure" in the city's luxury shopping district.
The choice of the Chanel logo, whose store is across the street, was meant to reflect the "battle of brands," he added.
Following his arrest, the artist paid out 130,000 Hong Kong dollars to clean the wall, including shipping special chemicals from Denmark and power-hosing the wall.
By Friday morning, Powner said the stone wall was 98 percent clean.
He has previously sprayed his designs on walls in Berlin, New York and Paris, where targets have included McDonald's, Yves St Laurent and Chanel, but this is the first time he has faced charges.
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Schwarz's signature style, which he calls liquidation, is a logo covered in wet paint which then drips down the wall creating a bleeding effect.
The Parisian daubed a Chanel logo on to the building in the upmarket Central district in July, although the property is better known as the location of an Armani store.
The building owners have filed a separate civil suit seeking damages, which will be heard at a later date, Schwarz's lawyer Andrew Powner told AFP after the decision.
The early-morning painting session was recorded in a YouTube video and Schwarz wore his trademark mask and yellow jumpsuit.
He was arrested by police a few hours later along with two Hong Kong residents, previous reports have said.
Speaking before Friday's decision, Schwarz said he chose the Armani store because it had "the best wall for exposure" in the city's luxury shopping district.
The choice of the Chanel logo, whose store is across the street, was meant to reflect the "battle of brands," he added.
Following his arrest, the artist paid out 130,000 Hong Kong dollars to clean the wall, including shipping special chemicals from Denmark and power-hosing the wall.
By Friday morning, Powner said the stone wall was 98 percent clean.
He has previously sprayed his designs on walls in Berlin, New York and Paris, where targets have included McDonald's, Yves St Laurent and Chanel, but this is the first time he has faced charges.
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