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A cabinet minister will face no action by police over a leaflet which asked voters if they wanted a Gypsy and traveller site near them.
Welsh Secretary David TC Davies had been accused of creating a "hostile environment for Gypsies and travellers".
The leaflet raised concerns about plans for a site in his Monmouth constituency.
The Conservative MP has been asked to comment.
Mr Davies had been defended by Deputy Prime Minister Oliver Dowden when it emerged that the leaflet's contents were being looked at by Gwent Police.
MrDowden denied the language was racist and said Mr Davies was "highlighting the failure of the local Labour council to carry out a proper consultation on this, that is entirely what people would expect their local Members of Parliament to do".
But deputy Welsh Labour leader Carolyn Harris called it one of Mr Davies's "gaffes".
Travelling Ahead, which provides advocacy and advice for Gypsy, Roma and traveller communities in Wales, had claimed the leaflet was a "clear breach of the Equality Act, dog whistle actions intended to create hostile environment for Gypsies and travellers".
Monmouthshire council, which has been Labour-run since the Conservatives lost control of the authority at the 2022 election, announced at the end of July a consultation on potential sites to give its plans more consideration, external.
The authority, like all others in Wales, is under obligation to provide sites where there is a need.
In a statement Gwent Police Ch Supt Carl Williams said: “We launched a review into the contents of a leaflet published and distributed in Monmouthshire regarding proposals for a development of a Gypsy and traveller site.
“Officers have spoken to several people from the Gypsy and traveller and settled communities before seeking advice from the Crown Prosecution Service (CPS) on whether the leaflet’s contents constituted any offences.
“Any allegation of discrimination is taken extremely seriously and following this review, we will not be taking any further action.”
In a previous statement, Mr Davies said: "The location of authorised and unauthorised traveller sites is a legitimate matter for public debate and scrutiny.
"It is entirely valid to criticise a lack of wide public consultation by a council.
"I have been contacted by many upset residents at the shortness of the consultation and the proposed locations for the sites.
"I have also been told that many from the Gypsy and traveller community are also upset at the proposed locations for the sites. This is not a criticism of the Gypsy and traveller community."