The prime minister will not face a police investigation into his links with an American businesswoman, but a review has found he had a “close association” with Jennifer Arcuri and there may have been an “intimate relationship”.
Mr Johnson has faced accusations that he used his position while mayor of London from 2008 to 2016 to benefit and reward Ms Arcuri.
Multiple inquiries were launched after it emerged she was given more than £125,000 in public money and privileged access to overseas trade missions led by Mr Johnson during his time as London mayor.
The PM has previously told Sky News that “everything was done with complete propriety” when asked about the allegations.
Downing Street welcomed the news, describing the complaint as “politically motivated”
“Such vexatious claims of impropriety in office were untrue and unfounded,” a spokesman for the PM said, adding: “This was not a policing matter, and we consider this was a waste of police time.”
In October, government auditors deemed that a £100,000 grant awarded to Ms Arcuri was “appropriate”.
Ms Arcuri has said any grants received by her companies and any trade missions she joined were “purely in respect of my role as a legitimate businesswoman”.
She has insisted she “never, ever” received any favouritism from Mr Johnson when he was London mayor, but refused to say whether they had an affair.
Ms Arcuri has said it is “really categorically no one’s business what private life we had, or didn’t have”.
Neither Mr Johnson nor Ms Arcuri have denied that they were involved in an affair.
In the police watchdog’s report it details a “Witness A” as telling the inquiry that Ms Arcuri disclosed to them that she and Mr Johnson were in a sexual relationship.
Independent Office for Police Conduct director general Michael Lockwood said the watchdog carried out a “thorough, independent and impartial assessment” into whether there were “reasonable grounds” to suspect “the criminal offence of misconduct in public office had occurred”.
“We found no evidence to indicate that Mr Johnson influenced the payment of any sponsorship monies to Ms Arcuri or that he influenced or played an active part in securing her participation in trade missions,” he concluded.
But the watchdog said it “would have been wise” for Mr Johnson to have declared their “close association” as a conflict of interest.
Mr Lockwood said that officials making decisions about funding and trade trips may have been influenced by Mr Johnson’s “close relationship” with Ms Arcuri.
And the report found there was “some evidence” that Mr Johnson may have been aware that Ms Arcuri was on an attendee list for a trade mission event in New York, even though he disputed it.
The allegations were referred to the IOPC by the Greater London Authority in September.
As the mayor of the capital, Mr Johnson was also head of the Office for Policing and Crime, a position equivalent to a police and crime commissioner.
Because of that, the IOPC must investigate any suggestion a criminal offence may have been committed by the office holder, to see if an investigation should be launched.
This is regardless of whether or not they are still in that role.
In the wake of the IOPC’s decision, the London Assembly has said it will resume its investigation into Mr Johnson that it paused at the request of the police watchdog.
The IOPC has said the Greater London Authority should consider whether Mr Johnson breached the code of conduct for failing to declare his relationship with Ms Arcuri.
Len Duvall, the GLA’s Labour Group leader and chair of its oversight committee, said: “The IOPC was looking specifically at whether he committed a criminal offence.
“That’s not our remit and their decision doesn’t have any real bearing on our investigation, which will focus on his conduct as Mayor of London.”
Analysis: There were four investigations into this, this one was the most serious
By Tamara Cohen, political correspondent
There were at one point four investigations going on into the issue of Boris Johnson’s relationship with Jennifer Arcuri and whether her company received privileged access to funding and official visits as a result.
But this one by the police watchdog, which could have opened the door to charges of misconduct in public office, was by far the most serious – and Downing Street will be relieved that this chapter is now over.
Pictures of Ms Arcuri – often one in a Union Jack bikini – dominated newspaper front pages for weeks at the start of his premiership, with claims the pair had been close for several years when he was London mayor.
The IOPC report says their relationship “may have been intimate”. But given voters and political colleagues’ familiarity with Boris Johnson’s much-discussed personal life over the years, this suggestion is unlikely to cause much damage.
A bullish statement from Number 10, accusing those who reported the prime minister of wasting police time, shows their confidence his opponents have gravely miscalculated, although a further probe by the London Assembly now begins.