Windows of the Palace of Westminster in central London had been closed as MPs, peers and others within the complex were locked out onto the Lords' rooftop terrace as police officers investigated the envelope.
"A suspicious package has been delivered to the Houses of Parliament. Officers are at the scene examining the contents of the package," a Scotland Yard spokesperson said.
The officers were "stood down" after a few hours when it emerged that the letter had been received by independent peer Lord Ahmed, the first Muslim member of the House of Lords.
"Peers car park and parts of the terrace were closed temporarily but have now been reopened. The closure was put in place while a package containing a white powder was investigated by specialist police units, which is standard procedure. The powder was found to be non-harmful," a House of Lords spokesperson said.
Lord Ahmed reportedly found "white powder" in an envelope addressed to him, along with a racist letter.
Peers and reporters were having lunch on the terrace at the time of the alert.
A correspondent for the 'The Times' was among those caught up in the lockdown and tweeted from the terrace: "Chemical incident in parliament underway for almost an hour. Investigating a white powder."
"Emergency supplies have arrived for the stranded on the Lords terrace," he later added.
July 7 marks the 11thanniversary of the terrorist bombings across London's transport network in 2005, whichclaimed 52 lives.
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