LONDON (AFP) - The firm which owns a poultry processing plant hit by an outbreak of the H5N1 bird flu virus in February will not face prosecution, Britain's food watchdog said Monday.

Nearly 160,000 turkeys were culled following the outbreak at the Bernard Matthews factory farm in Holton, Suffolk, eastern England, the country's first major outbreak of the potentially lethal virus.

The Food Standards Agency (FSA) said that its investigators had found "insufficient evidence" for legal action.

Its investigation was carried out after an environment department report in February told of inspectors seeing gulls feeding on meat scraps from uncovered waste bins and plastic bags which had contained meat being left in open bins.

The department has said that poultry imports from Hungary -- where Matthews has a subsidiary, and a virtually identical bird flu strain was found in January -- were the "most plausible" source for the outbreak.

But it has stressed that the source of the virus may never "conclusively" be found.

The FSA's decision was criticised by Peter Ainsworth, environment spokesman for Britain's main opposition Conservative Party.

"It seems entirely clear that there were breaches of biosecurity at the Bernard Matthews plant," he said.

"It was a matter of sheer luck that bird flu didn't spread into the wild bird population.

"Many people will therefore be rather surprised by the FSA's decision not to take further action."

Bernard Matthews, though, welcomed the news -- in a statement, Europe's biggest turkey producer said it had "always maintained that it has acted with the utmost integrity."