A lack of clarity around powers held by the Countywide Traveller Unit could see actions it takes challenged in the courts, a report by Northampton Borough Council says.
A council document says the arrangements that allow the unit to operate on behalf of the borough council when travellers set up encampments on public land in Northampton may not have been delegated clearly.
It means that actions taken in Northampton - such as orders to move caravans on - may not have been legal after March 31 2019.
The document, written by head of customers and communities Marion Goodman, says: "Following a recent review of the governance arrangements of the unit it has been highlighted that there is a lack of clarity in the previous agreement in relation to the formal delegation of these legal powers to the unit.
"It is important that appropriate arrangements are in place to ensure that the officers from the unit are properly authorised to use the legal powers to deal with unauthorised encampments on land which is within the area of Northampton Borough Council.
"Failure to ensure this could result in legal challenge to any action taken.
"Cabinet could choose not to approve the recommendation but to continue with the current arrangement for the operation of the countywide traveller unit. This would risk legal challenge to action taken by the officers from the unit."
The Countywide Traveller Unit is a single body that manages Gypsy and Traveller related issues on behalf of six of the seven district and borough councils within Northamptonshire and the county council.
The most recent agreement in relation to the Unit is now at an end and the member authorities wish to continue those arrangements, which is why the issue has arisen.
Councillors in the borough's cabinet will address the issue in public on Wednesday, and discuss whether new arrangements need to be in place top close the loophole.