Henao, who was also voluntarily suspended by Sky as they launched an internal investigation in 2014, has been cleared of any wrongdoing after his data were analysed by an additional panel of experts, the International Cycling Union (UCI) said on Tuesday.
"I am happy that this is finally over," said Henao. "It's been a difficult period for me but I know I have done nothing wrong, so I was confident that the UCI would come to this decision. I am looking forward to getting back on the team and racing."
Henao was withdrawn from racing by Team Sky last month after concerns re-surfaced about his biological data.
He had been contacted by the UCI and the Cycling Anti-Doping Foundation (CADF) with regards to his Athlete Biological Passport (ABP) data between August 2011 and June 2015.
"On 20 April 2016, in accordance with the World Anti-Doping Agency (WADA) Athlete Biological Passport (ABP) Operating Guidelines, the independent experts of the Athlete Passport Management Unit (APMU) in Lausanne, Switzerland, requested further information from Sergio Henao about his ABP values," the UCI said in a statement.
"As per the applicable ABP regulations, the rider’s explanations were sent to the same experts for review. After examination, the independent experts came to the conclusion that there was no basis to proceed further."
"We are pleased but not surprised by this outcome. We have always believed in Sergio and he has always had our full support,” said Team Principal Sir Dave Brailsford in a post from the team on Facebook.
"This decision obviously means he can now get back to racing and I am sure he will be ready to make a big contribution to the team during the rest of the season,” Brailsford said.
"What this process has highlighted is the gap in research regarding the physiology of athletes like Sergio who are born and raised at altitude and who continue to spend prolonged periods of time living at altitude.
"This is something I am sure that the anti-doping authorities will want to look at further in the interests of clean competition but also in the interests of others like Sergio." - Sir Dave Brailsford
The 28-year-old climber was voluntarily withdrawn by Team Sky for three months in March 2014 after their own monitoring of his ABP and his out-of-competition tests during his usual winter training block back home at high altitude in Colombia.
Sky commissioned an independent 10-week research programme into the biological characteristics of riders who live and train at high altitude with the results revealing nothing to raise suspicion of any wrongdoing by Henao.