"Captain Francesco Schettino is no longer under house arrest, but must stay in his home town," one of his lawyers, Paolo Bastianini, told AFP.

Schettino and eight others are under investigation following the tragedy off the Italian coast on the night of January 13, when the luxury Costa Concordia hit rocks and capsized with 4,229 people from dozens of countries on board.

Bastianini said his client would have to remain in Meta di Sorrento but "will no longer be bound by the conditions linked to his house arrest."

Schettino, who was placed under house arrest in February because magistrates in the Tuscan town of Grosseto feared he was a flight risk, had been banned from speaking to anyone apart from his lawyer and close family.

"He is a free man. He could go to the seaside today, if he wants. But he won't. He is also at liberty to communicate, but he won't. I have given him strict orders not to leave the house or speak to anyone," Bastianini said.

Schettino is accused of causing the accident by sailing too close to the shore, then delaying the evacuation and abandoning ship before everyone had been rescued as the giant liner toppled over in icy waters.