Speaker Bercow said the debate had to go ahead
The government could send "further guidelines" to judges after what many MPs believe were efforts to "gag" reporting of Commons proceedings.
Minister Bridget Prentice said lawyers' advice to the Guardian on reporting a parliamentary question on oil firm Trafigura had been "incorrect".
MPs raised concerns over "super-injunctions", forbidding the media from even mentioning that injunctions exist.
Trafigura's lawyers say they did not try to stop reporting of Parliament.
The Guardian published a copy of the injunction - which banned references to a scientific report commissioned by Trafigura into alleged dumping of toxic waste in the Ivory Coast in 2006 - on Wednesday.
The newspaper said this had extended to reporting of any discussion of the subject by MPs.
Trafigura's lawyers, Carter-Ruck, dropped attempts to keep the report secret after criticism from MPs and the media but insisted they had not "improperly sought to stifle or restrict" debate and reporting.
In a Westminster Hall debate on libel law and parliamentary proceedings, Liberal Democrat MP Evan Harris said: "There's a greater and greater concern out there that the courts are not dealing fairly with this...
"I urge the government to review the law in the area more widely than it has already done."
Mr Harris added that the "balance of the judge-made law made at the moment in these areas is wrong".
Justice minister Ms Prentice said: "The reporting of parliamentary proceedings is protected by qualified privilege."
She added that this meant "material can be published as long as it's fairly reported".
Ms Prentice said it was "most certainly my view that the advice given" by Carter-Ruck and lawyers for the Guardian had been "incorrect".
She added that she was "happy" to send them advice "to peruse at their leisure".
Ms Prentice said: "The secretary of state for justice [Jack Straw] has already asked senior officials in the department to discuss that issue [the role and use of injunctions] with lawyers from newspapers."
She added that "it might be appropriate for further guidelines to be sent out to the judiciary".
Earlier, Commons Speaker John Bercow said the Westminster Hall debate should go ahead despite Trafigura's concerns that certain issues likely to be discussed were sub judice and could prejudice ongoing legal proceedings.
He said the right of the Commons to debate matters of public interest and concern must be preserved.
On Tuesday the most senior judge in England and Wales said it was a "fundamental principle" that the sovereign right of Parliament to debate what it wanted should not be compromised by the courts.
"It is a precious heritage that, in my view, should be vigorously defended and maintained by this generation," the Guardian reported Lord Chief Justice Lord Judge as saying.
He said he would need "some powerful persuasion - and that is close to saying that I cannot envisage it - that it would be constitutionally possible or proper for a court to make an order that might prevent or hinder or limit discussion of any topic in Parliament".
"We do not use the words 'fundamental principle' very frequently but this is a fundamental principle," he added.