The following from Hamish Birchall

The Royal Borough of Kensington and Chelsea (RBKC) has decided that the street dancers, or 'masqueraders', accompanying the Notting Hill Carnival floats will qualify for the Licensing Act's morris dancing exemption. The wording allows for 'any dancing of a similar nature'.

Had RBKC not adopted this interpretation, carnival organisers would have faced entertainment licence fees of up to £64,000. Extra fees apply where attendance exceeds 5,000. There is no exemption for 'incidental dancing'. As it is, for the first time the carnival's 30-40 'static sound systems' will require premises licences or Temporary Events Notices. Fees for these are not expected to exceed £2,000.

If RBKC has adopted a liberal reading of the morris exemption, other local authorities are taking a different view.

According to this report in the online Wiltshire Times, Trowbridge has already banned majorettes (unless licensed), and Warminster looks set to follow:
http://www.wiltshiretimes.co.uk/news/trowbridgenews/display.var.843961.0.major_upset_for_troupe.php