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According to a report in The Blast, Spacey's contract does not have an morality clause, meaning that the streaming giant cannot terminate the star's services for his personal actions.
A source said Spacey's contract can only end if he is "unavailable or incapacitated" to perform his duties.
In response, a spokesperson from the streaming service replied saying, "Netflix will not be involved with any further production of House of Cards that includes Kevin Spacey. We will continue to work with MRC (the show's production company) during this hiatus time to evaluate our path forward as it relates to the show..."
The rep added they will not move forward with "Gore," a biopic on the American writer Gore Vidal, featuring Spacey in the title role.
The series was in its post-production phase.
Actor Anthony Rapp had accused Spacey of sexual misconduct, when he was just 14.
Production on the sixth and last season of the Netflix series, in which the actor plays the lead of Frank Underwood, has since been suspended.
Earlier, the streaming service released a statement, saying said it was "deeply troubled" by Rapp's allegation.