A government error 25 years ago means the Video Recordings Act (VRA), which imposes age requirements on videos, DVDs and video games, was never enacted. The government failed to notify the European Commission of the VRA age classification and labelling requirements.
The Department for Culture, Media and Sport (DCMS) says that due to consultation processes it will take at least three months for any legislative changes to be made.
The Association of Convenience Stores has advised retailers to continue to abide by the age restrictions until the loophole can be closed.
Barbara Follett, parliamentary under secretary for the DCMS, said she hoped that retailers would remain compliant with the provisions of the VRA on a voluntary basis.
DCMS confirmed that any retailer who had been prosecuted under the act would not be able to overturn their conviction.
Steve Redmond, spokesman for the Entertainment Retailers Association, which represents retailers who sell DVDs, said: "This is extraordinary. For 25 years retailers have been faithfully administering the system and now this happens.
"We are sure no reputable retailer will seek to exploit a situation for which the only appropriate description would seem to be 'cock-up'."