Hamid Ghassemi-Shall had been in an Iranian prison since he was arrested in 2008 and charged with espionage until he was freed last month.
Ghassemi-Shall, who emigrated from Iran after that country's 1979 revolution, was sentenced to death in 2009 and an Iranian court later rejected an appeal.
The Toronto shoe salesman had made several trips back to visit family without incident before his arrest in 2008.
Minister of State for Foreign Affairs Lynne Yelich says the government is relieved by the positive outcome of Ghassemi-Shall's case.
However, Yelich says Ottawa remains concerned by the "untold numbers of political prisoners languishing in Iran's notorious prison system."