Durham police first examined the claims in February, but did not launch a full-fledged criminal investigation.
But in May, after growing pressure, the force confirmed that it would fully investigate the allegations.
In a statement, the force said it had conducted a “detailed, comprehensive and proportionate” investigation.
They added that a “substantial” amount of evidence had been gathered, but in the end there was no case to answer because there was a “work exemption”.
Reacting to the news, a Conservative Party source said: “The people of Durham will be surprised to learn that they were allowed to stay drinking inside after working with people outside their home under the restrictions of COVID.
“The other forces have obviously taken a different view. Of course, if Keir Starmer had kept to the standards he demands of others, he would have resigned two months ago.”