Strauss-Kahn was charged last year with helping to procure prostitutes for sex parties in one of a string of cases that came to light after he was forced to resign from his IMF job over an alleged sex attack on a New York hotel maid.
But the prosecutor's office in the northern city of Lille, where some of the parties took place, announced today that it considered the evidence against Strauss-Kahn and one other man, Jean-Luc Vergin, as insufficient for them to be sent to trial.
The judge in charge of the case now has a month to decide whether to follow the prosecutor's advice or to insist on Strauss-Kahn standing trial.
In France it is not unusual for judges to ignore prosecutors' recommendations but Strauss-Kahn's lawyers voiced confidence their client would be cleared.
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"I'm happy the prosecutor shares our view that there is no admissible evidence of any crime or offence having been committed," lawyer Henri Leclerc said.
Strauss-Kahn, 64, admits attending sex parties in France and the United States but insists he did not know some of the women were being paid.
His lawyers have argued that he could not have known they were prostitutes because he had only ever seen them naked.
If the pimping charges are dropped, Strauss-Kahn will have emerged from two years of legal turmoil without having been convicted of any crime.
Last month he was snapped on the red carpet at the Cannes film festival in the company of a new girlfriend and he also presided over the opening of South Sudan's new National Credit Bank.
In December, he agreed to pay undisclosed damages -- reportedly in excess of USD 1.5 million -- to Nafissatou Diallo, a New York hotel maid whose 2011 allegation of sexual assault forced him to resign from his IMF job and wrecked his chances of becoming French president.