In a statement late on Wednesday, the Saint-Cloud city hall said the money had been agreed before the final line-up of the festival was announced and that it had decided to withdraw the funding on July 3.
The Saint-Cloud city said it respects the festival's programing freedom, and had not sought "to enter into any negotiations with a view to influencing the programing".
"On the other hand it does not finance political action, nor demands, and even less calls to violence, such as calls to kill lawmakers, whatever their nationality," the statement said.
Rock-en-Seine could not be immediately reached for comment.
Kneecap member Liam Óg Ó hAnnaidh, who is known by his stage name Mo Chara, was charged in May with a terrorism offence for allegedly displaying a flag of Hezbollah, the Iranian-backed militant group that is proscribed as a terrorist organisation in Britain.
