Aslamazyan, a Russian national, who headed the Educated Media Foundation, was detained in 2007 by Russian custom officers for failing to declare foreign currency of around $2,800 more than the permitted sum of $10,000.
During its first session since moving from Moscow to St. Petersburg, the Constitutional Court ruled that by charging Aslamazyan with smuggling the entire sum, including the permitted amount of $10,000, the seriousness of the accusations had been inflated, which was unconstitutional and violated the principles of equality and justice.
The court concluded that Aslamazyan should have been charged with an administrative offense which carries a fine of 1,000 to 2,500 rubles ($43-$106).
A motion to dismiss Aslamazyan's case will be filed on May 28, her lawyer said. "The Constitutional Court's decision must be implemented immediately whether the judges like it or not," Viktor Parshutkin said.
He said that he hoped that all criminal charges against Aslamazyan and the foundation employees would be dismissed, adding that the court decision meant that "hundreds of thousands" of similar smuggling cases would also be subject to review.
"After a year of suffering and a nightmare, I am happy now that the decision by the Constitutional Court enables me to prove I am not a criminal," Aslamazyan said after the court session.
Formerly known as Internews Russia, the Educated Media Foundation was involved in training broadcast journalists, who were largely from the Russian provinces.
Last April, police conducted a raid on the NGO's Moscow headquarters, seizing computers and financial documents.
Supported by grants from Western charities such as the Open Society Institute, as well as the USAID and TACIS assistance programs, the group was ordered to suspend its operations following the raids, and was then forced to close down altogether. Aslamazyan was placed on the federal wanted list.
The case against Aslamazyan prompted more than 2,000 Russian journalists to send an open letter of protest to former-president Vladimir Putin. The journalists claim the proceedings against Aslamazyan were launched to deter foreign-funded NGOs from meddling in Russian politics.
In late 2005, the Russian parliament passed a Kremlin-sponsored bill preventing foreign NGOs from running branch offices in the country, the move meant that many Russian organizations were ineligible for most sources of foreign funding.
Presented by authorities as a measure to protect national security, the bill drew a strong reaction from the Council of Europe and rights activists at home and abroad, who called the new piece of legislation an attempt to weaken civil society.