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The owner of a port has lifted its temporary ban on live animal exports weeks before it faced a High Court challenge over its decision.
Thanet District Council, which owns the Port of Ramsgate in Kent, admitted that the basis on which it had imposed a temporary ban "could no longer be sustained''.
The local authority faced a judicial review at the High Court from December 11 after transporters and owners of the ferry MV Joline challenged its decision to bring in the ban.
Last month a High Court injunction was served on the council which allowed live animal movements to resume until the outcome of the judicial review.
Legal advice received by the council since then indicated it would not be successful, and it decided to avoid costly proceedings by lifting its temporary ban.
District councillor Michelle Fenner said the authority was obliged to "protect the public purse'' and that its "hand has again been forced'' by its duty to act lawfully.
She said it was "disappointing'' but that they would continue to press to protect animal welfare amid calls from campaigners, including actress Joanna Lumley, to end the "abhorrent'' trade.
The suspension of live animal exports by the council was introduced in September after 42 sheep which arrived at the port in a lorry unfit for transporting live animals had to be put down due to their lameness. A further two drowned and two suffered broken legs.
The deaths occurred after the RSPCA provided a report to the council in the summer highlighting the port's inadequate facilities and warning of severe problems with animals in an emergency.
A letter co-written by leading council members was then sent to Environment Secretary Owen Paterson making requests, including an urgent establishment of a livestock resting facility in Kent.
The local authority said the suspension would be lifted if suitable facilities could be built within the port and if it deemed it a priority compared with other issues.
Following the suspension at Ramsgate, the operation moved to Ipswich but the Suffolk port's owners also halted exports amid concerns about suitable facilities there.
Thanet District Council then received notice that it faced a judicial review over its decision to suspend exports at Ramsgate.
Today, the council called on the transporters to now drop their legal proceedings.
Ms Fenner said: "Our position has always been to work within the legal framework to ensure the welfare of animals.
"The decision to impose the temporary ban at the port was not taken lightly, following the horrific incidents in September, and we still consider this action to have been correct.
"In terms of now having to lift the ban, our hand has again been forced as we are duty-bound to act in accordance with the law. We have to consider our absolute obligation to protect the public purse.
"As we've done everything in our power to get to this point, it is disappointing. However, we have worked extremely hard in recent months and will continue to push the agencies involved in whatever legal way we can to ensure that the welfare of animals is protected.''
The council said that an ongoing review by Defra into the circumstances and procedures of exporting live animals is unlikely to result in more facilities being required at the port, and that had also influenced its decision.
In defence of the controls in place, the National Farmers Union (NFU) has previously said that journeys of more than eight hours make up a very small minority of movements.
And it said the protection of animals during transport has improved considerably in recent years and current regulations do not compromise animal welfare.
Emma Slawinski, senior campaigns manager at Compassion in World Farming, said: "We share Thanet District Council's disappointment that they have now dropped the legal bid to protect the suspension of live exports from Ramsgate.
"Live export is an issue that requires action on a national scale and we urge the Government to act now to end this vile trade.''