Catalonia's regional parliament on Thursday slammed Spain's "shift towards authoritarianism", insisting that fugitive Catalan ex-president Carles Puigdemont - who remains in exile in Belgium - is their legitimate leader.
"I will not put myself forward as candidate to be appointed regional president", Puigdemont on Thursday announced solemnly from Belgium in a video posted on social media, standing in front of Catalan and European Union flags.
Puigdemont said his decision "does not fully guarantee the restoration of our autonomy".
Catalonia has been ruled directly from Madrid for the last four months since Rajoy invoked constitutional powers to take over government in the region.
Mr Puigdemont said his party would propose a pro-secession campaigner, Jordi Sanchez - now in remand in a Madrid prison on charges of sedition - as an alternative candidate.
Mr Sanchez's path to becoming Catalonia's president, however, also is fraught with difficulties because he would need the approval of Pablo Llarena - the Supreme Court judge leading the sedition investigation against Puigdemont - to attend the investiture debate in the region's Parliament.
After the regional election Puigdemont remained the separatists' favoured candidate to lead Catalonia again.
The newly elected Catalan parliament tried to declare Puigdemont a new president of the region but the Spanish authorities banned to swear in him in absentia.
Other members of his political entourage have been jailed in Madrid, awaiting trail over their roles in the independence push.
Mr Puigdemont is a charismatic leader of the independence movement and is the preferred candidate of most Catalan secessionists to head the regional government.
Spanish Prime Minister Mariano Rajoy described on Thursday plans of the Catalan independence supporters to create a parallel regional government in Brussels as absurd.
Three Catalan independence leaders being held in pre-trial detention have already lodged a complaint against their imprisonment with a United Nations panel, hoping to exert pressure on Madrid to free them. The region has been without an official leader since Puigdemont fled to Belgium in October a year ago. Madrid "has won", he wrote.