Portsmouth are facing a nine point deduction for entering administration
HM Revenue and Customs (HMRC) has formally dropped its challenge over the validity of Portsmouth football club's move into administration.
Barrister for HMRC, Gregory Mitchell, told the High Court that the club had now supplied details of its finances.
He added that after a meeting with Portsmouth's administrator, HMRC had been reassured over his independence.
Portsmouth's administrator Andrew Andronikou said the club could now exit administration "in six to eight weeks".
HMRC, which had sought a winding-up petition, said administration "offers the best chance of the club surviving".
Mr Mitchell added that there would now be a meeting of Portsmouth creditors, including HMRC.
HMRC had been challenging Mr Andronikou's appointment.
Its acceptance of Portsmouth's move into administration means the Premier League is now expected to dock nine points from the club's tally. However, Mr Andronikou said he would challenge this.
"The [High Court] hearing occurred and the administration continues as normal," Mr Andronikou told the Reuters news agency.
"The cloud has been lifted. We had to go to court as a reference point but the administration has now been rubber-stamped."
Mr Andronikou added that on Monday, he met Cheshire millionaire Rob Lloyd, who is leading a consortium interested in buying the club.
"I met him last night and set out a few ground rules and we have agreed a way forward. There are still some boxes for him to tick," he said.
Speaking about the expected nine-point deduction for entering administration, Mr Androniko said: "Yes, it is a Premier League rule but that rule has never been tested, and that's what I will do."