Originally scheduled for May, the postponed Madrid tournament was scheduled to take place on the clay courts at Caja Magica between September 12 and 20.
“We share in the disappointment that the Mutua Madrid Open will not be able to take place this year,” said Andrea Gaudenzi, the ATP Chairman, in a statement.
The tournament was expected to boast a stellar field, including world number two and five-time champion Rafael Nadal, and would have been a key warm-up event two weeks before the start of the French Open.
The Italian Open is due to go ahead in Rome in the week leading up to the grand slam at Roland Garros but it remains to be seen how other competitions react.
Before then, hard-court events are planned later this month in Lexington and New York ahead of the US Open at Flushing Meadows, which is due to start on August 31.
After a rise in coronavirus cases in Spain, the regional government of Madrid recommended on Saturday that the Madrid Open be called off, with its cancellation duly confirmed on Tuesday.
Recent COVID-19 outbreaks in Madrid had caused concern around maintaining the safety of players, staff and fans, despite daily cases of the virus falling dramatically in Spain through most of June and July.
There have been over 1,500 positive cases a day in the country over the past week and, in total, Spain has recorded more than 28,000 deaths, according to official figures.
Tennis has been slower than other sports to restart, with the amount of travel required from players and their support teams considered particularly problematic.
The Palermo Ladies Open became the first official Tour event to take place since early March when the main draw began in Sicily on Monday.
However one unnamed player was forced to withdraw after testing positive for coronavirus, organisers confirmed on Saturday.
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