The British government is working to overcome a judge's ruling that the "Real IRA" is not illegal under current legislation.
Northern Secretary Paul Murphy said the ruling would be appealed and, if necessary, the law changed.
At Belfast Crown Court yesterday Mr Justice Girvan cleared four men of being members of the dissident republican group on the grounds that its name did not appear on the list of proscribed organisations drawn up under legislation.
The British government has outlawed the IRA and assumed that covered all organisations using the name - whether that be the Provisional IRA, "Real IRA" or Continuity IRA.
Legislation is similar in the Republic and a challenge to it on the grounds that it does not specify a particular grouping has already been turned down - but not by the highest court in the land.
Mr Murphy said today: "What we will do is appeal this and, if necessary, we will change the law on it."
He added: "The term 'IRA' I think, both in Ireland and in the UK, was an umbrella term for all the different groupings within the Irish Republican Army.
"If this is a loophole we have got to cover up, then we'll deal with it. We'll take it to appeal."
Politicians were outraged.
Mr Peter Robinson, deputy leader of the Democratic Unionist Party, said the government had to act to clear up the mess which had been exposed by the judge's ruling.
Mr Justice Girvan's ruling had "highlighted a major flaw in the present anti-terrorism legislation."
It had allowed those believed to be involved with the paramilitary group to evade conviction on what was "clearly a technicality", said Mr Robinson.
The government's "reckless approach" when the situation had been challenged during the passage of the Terrorism Act in 2000 had led to the present situation, he said.
Fine Gael Justice spokesman Mr Jim O'Keeffe said the ruling in Belfast could have "serious implications" in the Republic.
Here, the "Real IRA" as a specific group was not proscribed, but the Special Criminal Court and Court of Criminal Appeal had ruled the lack of proscription was not an offence, he said.
However the Supreme Court had not ruled on the issue, he added.
"I will be raising this matter with the minister next week. I would like to see a clear statement from the government on the implications on this judgment for this jurisdiction," said Mr O'Keeffe.