A former Indonesian intelligence chief was cleared Wednesday of playing any role in the fatal mid-flight poisoning of the country's most prominent human rights activist and a symbol of defiance in the face of authoritarian rule.

Critics called the ruling proof that Indonesia's courts are still unable to hold high officials accountable a decade after the country embraced democracy.

Munir Thalib was poisoned on a flight to Amsterdam in 2004 after an off-duty pilot with the national carrier, Garuda, boarded his plane posing as an undercover security agent and slipped him a dose of arsenic.

The murder case became a critical test of Indonesia's willingness to come to grips with the authoritarian legacy of the late dictator Suharto, who was swept from power by massive street protests in 1998 after 32 years in charge. Thalib's efforts to expose atrocities had made him an icon in the struggle against the dictatorship.

Hundreds of Thalib supporters protested outside the courthouse Wednesday.

The European Union and the United States have followed the murder case closely, with Congress earlier this year threatening to withhold $2.7 million in military aid pending the completion of the criminal investigation into the killing.

On Wednesday, the South Jakarta District Court acquitted retired intelligence chief and Maj. Gen. Muchdi Purwoprandjono of charges of murder and abuse of power, saying prosecutors had failed to prove his involvement in Thalib's death.

But a long trail of evidence presented during the trial appeared to implicate Purwoprandjono's former employer, the State Intelligence Agency, including records of dozens of phone calls between Purwoprandjono and the killer's cell phones around the time of the murder.

The acquittal is a major setback for legal reformers, who had hoped Indonesia's court system had become strong enough after Suharto to hold accountable high-ranking officials.

"This outcome makes human rights defenders greatly question their safety," Ifdhal Kasim, chairman of the National Commission for Human Rights, told The Associated Press. The verdict "shows that our judicial system has failed to fully uphold its independence."

Indonesia, an impoverished former Dutch colony of 235 million people, has never confronted the violent legacy of Suharto, who was blamed for the deaths of hundreds of thousands of communists in 1965 and countless other crimes for which he was never put on trial.

Purwoprandjono has long been implicated in Suharto-era crimes, including the disappearance of anti-Suharto students in 1998 when he briefly headed the feared special forces unit, Kopassus.

He maintained his innocence through the recent proceedings.

"This is a big loss for Indonesia," said Rafendi Djamin of the Jakarta-based Human Rights Working Group. "The facts strongly indicate that the State Intelligence Agency was behind this assassination."

A presidential fact-finding team concluded in 2005 the murder was very likely a state conspiracy, but the conclusions were never officially published because they were too politically explosive.

Interference by high-level officials kept the case out of court for several years, while intimidation during the trial led witnesses to retract key testimony or fail to appear in court, court observers said.

The Supreme Court convicted and sentenced the pilot, Polycarpus Priyanto, to 20 years in prison in January 2008, overturning an earlier acquittal by a lower tribunal. A national official was sentenced to a year in prison as an accessory.

Thalib's widow, Suciwati, who like many Indonesians uses a single name, said prosecutors were considering filing an appeal after their 15-year sentencing demand against Purwoprandjono was struck down.

"I have not only lost Munir, I have lost my sense of justice," she said. "The outcome will be seen by the international community as (a test of) how seriously Indonesia enforces the rule of law."

Wednesday's decision also put President Susilo Bambang in a bind. He had promised to resolve the murder during his term in office, which expires in April.