The move highlights how European Union countries are struggling to uphold rules under which people fleeing war and persecution are supposed to apply for asylum in the first EU country they enter and not travel from one country to another.
The decision comes amid a surge of migrants and refugees arriving from Germany and refusing to apply for asylum in Denmark, saying they want to go Sweden, Finland or Norway instead.
Danish authorities initially insisted they must register in Denmark but changed their minds after hundreds of migrants demanded the right to cross the country.
"We can't detain foreigners who do not want to seek asylum (in Denmark)," Denmark's police chief Jens Henrik Hoejbjerg said. "Therefore, there is no other option than to let them go, and we cannot prevent them from travelling wherever they want."
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