By Kylie MacLellan
LONDON (Reuters) - Britain's electoral watchdog has picked the "Vote Leave" group, backed by London Mayor Boris Johnson, to be the official "Out" campaign ahead of a referendum on June 23 on whether Britain should remain in the European Union.
Wednesday's decision, which hands the group several advantages over rival "Out" campaigns including a higher spending limit, will pit Johnson against his party leader Prime Minister David Cameron, effective head of the "In" official campaign.
The two main groups campaigning to leave the EU, one backed by the UK Independence Party leader Nigel Farage and the other by several senior members of Cameron's Conservatives including his close friend and justice minister Michael Gove, had been involved in a bitter contest to win the designation.
"After careful consideration, the commission decided that 'Vote Leave Ltd' better demonstrated that it has the structures in place to ensure the views of other campaigners are represented in the delivery of its campaign," the Electoral Commission said in a statement explaining why it had been chosen over rivals "Grassroots Out."
Being lead campaigner brings with it a higher spending limit of 7 million pounds ($10 million), free distribution of campaign materials to voters, campaign broadcasts and a grant of up to 600,000 pounds to be used for administrative costs.
The battle for control and money at the top of the rival "Out" campaigns and their different visions of the fate of Britain outside the EU have threatened to hinder their effectiveness in what is set to be a tight contest.
An ICM poll on Tuesday showed support for Britain leaving the bloc was running at 45 percent, three points ahead of the 'In' camp.
UKIP's Farage and Grassroots Out both congratulated Vote Leave on the designation and said they would continue to campaign for "Out". But Leave.EU, which had been backing Grassroots Out for the designation, threatened to prolong the feud by saying it was considering contesting the decision.
"There are a number of judgments according to the Electoral Commission's own criteria that do not make sense," said Arron Banks, co-founder of Leave.EU, a millionaire insurance tycoon who has helped bankroll the campaign for "Out".
"If we are to avoid the most important vote of our lives being rigged then I feel duty bound to take this course of action."
Non-lead campaigns are allowed to spend up to 700,000 pounds each on the referendum campaign, while UKIP can spend up to 4 million pounds.
Earlier on Wednesday, Citi become the latest Wall Street bank to weigh in to the campaign to keep Britain inside the EU, by making a six-figure donation to the 'In' campaign, a source told Reuters.
(Additional reporting by Estelle Shirbon and William James; editing by Stephen Addison)