The dispute revolves around consultation and debate over the proposals to restrict advertising of products high in fat, sugar or salt that are targeted at children.

All of the options set out by Ofcom have two things in common: a ban on food and drink advertising or sponsorship to pre-school children and a set of eight rules about the content of food and drink advertising set out by the Broadcast Committee of Advertising Practice (BCAP).

Several bodies, including the Food Standards Agency (FSA) and the NHF, called for a complete ban on advertising of products high in fat, sugar or salt that are targeted at children before the 9pm watershed.

Such proposals were called "disproportionate" by both Ofcom and, separately, the Food Advertising Unit (FAU).

The NHF announced at the end of May that it was seeking a judicial review against Ofcom on the grounds that the regulator was excluding consultation on a pre-9pm watershed ban.

On 8 June Ofcom posted a supplemental consultation paper on its website saying that it would welcome comments on a pre-9pm ban.

"We are happy that Ofcom has made these significant concessions and made it unnecessary to take them to court. We are therefore withdrawing our application for judicial review," said Jane Landon, deputy chief executive of the NHF.

"Ofcom still maintains that the 9pm option would place a "disproportionate" burden on broadcasters, but it has clearly albeit reluctantly acknowledged the ground swell of public opinion that this option merits serious debate as part of this consultation."

But consultation was always part of the initial proposal, say Ofcom, and the deadline has even been extended from 6 June to 30 June.

An Ofcom statement read: "The fact is that the National Heart Forum has withdrawn its legal claim against Ofcom in its entirety. No concessions have been made by Ofcom and no terms of settlement have been agreed. The public consultation is continuing on the same basis as before.

This legal action was from the outset unfounded, unwarranted and unnecessary. The National Heart Forum and its legal advisers have consistently misrepresented the facts of both Ofcom's statutory role and its actions - we can only assume in an attempt to deflect attention from the National Heart Forum's withdrawal of its legal action.

The only reason Ofcom has not sought recompense for its own legal costs arising from this misguided and ill-informed action is that we believe it would be inappropriate to require this from a charity."

The response from broadcasters has involved claims that such a ban would be ineffective and that children would still buy such foods, while others have cited potential adverse effects on channels who generate their income from advertising.

Christy Swords, ITV's Director of Regulatory Affairs, said: " Such a ban would also threaten investment in programming by advertising-funded channels."

Revenues at risk from a pre-9pm watershed ban total £140.8m, equal to about 2.5 per cent of the broadcasters total income.