A New York court has ruled against allowing a Syrian-born Canadian to sue US authorities over his mistaken 2002 arrest for alleged terrorism links.

Maher Arar was held at New York's John F Kennedy airport following erroneous advice from Canadian officials that he had links to Islamic militants.

Mr Arar was then flown to Syria where he claims he was tortured, something which Syrian authorities deny.

In a statement, Mr Arar described the US ruling as a loss to the rule of law.

After exonerating him in 2007, Canadian authorities paid him 10.5m Canadian dollars (US$8.9m) in compensation.

Mr Arar is now seeking redress from the US, arguing that he was a victim of "extraordinary rendition", a process in which terrorism suspects are transferred to foreign countries for harsh interrogation.

But the New York court ruled that it was not authorised to intervene in the case.

"If a civil remedy in damages is to be created for harms suffered in the context of extraordinary rendition, it must be created by Congress," the court said in a written statement.

Mr Arar's lawyers say they will now take the case to the US Supreme Court.