The 36-year-old, identified by Xinhua news agency only by her surnamed Li, was
arrested three years ago on pornography charges after taking off her clothes
and chatting with other Internet users via webcam, the agency said.
Li, who also organised chat rooms for other nudists, has said she was "seeking
excitement", Xinhua said.
However, prosecutors subsequently determined they were in a legal "blind spot"
as online chat rooms are not defined in pornography laws.
New laws introduced since her arrest also failed to address the issue, it said.
"Under the existing laws, it is inappropriate to treat this as a criminal
offence," Li Kai, a prosecutor in western Beijing's Shijinshan district, was
quoted as saying.
He added that his office could not prove that Li had committed the criminal act
of disseminating pornographic materials.
Members of China's rubber-stamp lawmaking bodies are routinely criticised for
having little knowledge of the complex issues they are charged with
legislating.
Authorities plan to stage a major crackdown on cyber-porn, which is booming in
China, Xinhua reported last week.
Ten government departments will spend the next six months removing pornography
from the Web as part of the campaign.
Online pornography is already illegal and China takes great efforts to ban
offending sites, but cyber-sex remains widely available to anyone who wants to
search hard enough.
