Paul begins this passage with “therefore,” indicating that he is about to present an implication of the previous idea. That idea is found in the preceding verse, in which Paul describes his unregenerate self as serving God’s law with his mind, but serving the law of sin with his body. After Paul says “therefore,” he says that those who are in Christ, or united with Him, have no condemnation. Therefore, one may conclude that the preceding verse is describing an aspect of the condemnation upon the unregenerate, namely their enslavement to sin. Thus, Paul is saying that, in contrast to those in the flesh, those in Christ have no condemnation.
In the next verse, Paul gives the reason why those in Christ have no condemnation: the law, or effect, of the Spirit has set them free from the law of sin and death. In other words, the Spirit has placed the believer in Christ so as to set them free from enslavement to sin.
In the next verse, Paul explains why it is only the law of the Spirit that sets one free from sin, and not the Mosaic Law: the Law could not do it because it required one to not have an evil flesh. Rather, God did it. God did it by sending His Son to earth to become a man, and to be the sacrifice for sin. Also, He condemned sin in the Son’s flesh, or body, so that the Law’s requirement could be fulfilled in believers, who do not walk, or conduct themselves, according to the evil human nature, but according to the Spirit.