During discussions in the German city of Ravensburg on Wednesday evening, Merkel said that, at the EU level, the pipeline project had for the most part been approved.
"The Gas Directive gives the European Commission more leverage for objections, but it will not obstruct [its implementation]", Merkel said, as quoted by Handelsblatt newspaper.
The chancellor said she considered the project "acceptable".
Merkel also reiterated that gas transit through Ukraine remained an important issue.
"Ukraine must remain a transiting country, despite Nord Stream 2", the German leader said.
Te statement comes after the Council of the European Union passed on 15 April amendments to the EU Gas Directive that would extend EU principles on tariff regulation, ownership unbundling and transparency to all pipelines entering the bloc from non-EU countries. As such, the regulations may affect the pipeline's construction.
The amendments will take effect on 23 May, after which EU states will have nine months to incorporate the new rules into their nations laws.
The project has been welcomed by some countries in Europe and opposed by others who are concerned over the alleged danger of Europe becoming dependent on Russia and Ukraine having its transit role be diminished as a result. Moscow has given multiple reassurances that the pipeline is a purely commercial project.