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OTTAWA (Reuters) - The Supreme Court of Canada rejected on Thursday a request by German-Canadian arms dealer Karlheinz Schreiber to hear an appeal of a lower court decision to extradite him to Germany.
It was the third time the top court has rebuffed his attempts to appeal the decision to send him to Germany, where he faces charges of fraud, bribery, tax evasion, corruptly accepting secret documents and forging documents.
But it did not mean he would be heading overseas soon, because the government agreed this week not to send him off until he can testify at a public inquiry into cash payments he made to former Canadian Prime Minister Brian Mulroney after Mulroney stepped down as prime minister in 1993.
Mulroney says it was unwise to have taken the money in cash -- handed over in a series of hotel meetings -- but he says they were legitimate payments for his work in promoting Schreiber's businesses.
Justice Minister Rob Nicholson said in a statement that Schreiber was "eligible for immediate surrender to Germany" but would be held because of this week's agreement with him.
Under Canadian law, Nicholson has to send him to Germany within 45 days, or else Schreiber can apply for a discharge that would end the extradition process. But Schreiber has asked for a delay and waived his right to have the discharge.
"In this way, the public interest is served as Canadians will have the benefit of hearing Mr. Schreiber's testimony on Canadian soil, while at the same time preserving my ability to give effect to the German extradition request...," Nicholson said.
Schreiber had been able to live in his residence in Ottawa while he testified to a parliamentary committee about his dealings with Mulroney, but he returned to a Toronto jail on Wednesday in anticipation of the Supreme Court decision.
Nicholson said the government would respond in due course to any bail request by Schreiber.
He has been fighting extradition since 1999. In June, he was rebuked by the Federal Court for making "last-minute, last-gasp" attempts to avoid being sent to Germany.
A former German minister, Ludwig-Holger Pfahls, told a German court in 2005 that he took bribes from Schreiber to push through a 1991 sale of armored cars to Saudi Arabia.
Schreiber was also at the center of a political funding scandal that damaged the Christian Democrats, the party that ruled Germany under Chancellor Helmut Kohl for much of the 1980s and 1990s.
Editing by Peter Galloway