This follows concerns from Sussex Police about violence linked to the premises.
The Railway Tavern, situated in Station Road had been due to face a licensing review, after police called for its licence to be revoked.
They said landlord Phillip Ashby had “lost control” of the pub, which they linked to a number of violent incidents over the past year.
But before the hearing resumed, councillors were told Mr Ashby had voluntarily handed back the licence with immediate effect.
As a result, police withdrew their application. The pub has been closed since August 2025, when Mr Ashby suffered serious injuries during an incident outside the premises.
At the time, he posted on Facebook that The Railway Tavern was not expected to reopen under his ownership.
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