Two inquiries into the capture of 15 Royal Navy personnel by Iran have identified "shortcomings", but have said no one person was to blame.
Defence Secretary Des Browne said the report into the capture had identified "a series of vulnerabilities", such as inadequate training in boarding.
On the decision to allow two sailors to sell their stories, there had been a "collective failure of judgement".
Armed forces personnel would be banned from selling stories in future he said.
One inquiry, led by the governor of Gibraltar, Lt Gen Sir Rob Fulton, examined how the party from HMS Cornwall were captured by Iran, after carrying out a routine search of a cargo ship in waters between Iran and Iraq in March.
The second, headed by Royal Opera House boss Tony Hall - a former BBC director of news - looked at how the subsequent dealing with the media was conducted.
Mr Browne said the Fulton report would remain classified, because its publication would pose a risk to armed forces.
But he said its findings were that the events "were not the result of a single gross failing or individual human error".
They were due to "the coming together of a series of vulnerabilities" which left the sailors and marines in a position which could be "exploited through a deliberate act by an unpredictable foreign power", he said.
The report has recommended improvements in intelligence, communications, training and information sharing with other nations.
A recommendation that specialist boarding teams, not "composite teams", should be used in future had already been acted on, Mr Browne said.
Rules of engagement
But he said the report concluded that the rules of engagement had been "entirely appropriate".
And he said, despite speculation, there had not been a shortage of helicopter support, nor problems with the size and suitability of HMS Cornwall, or of the boarding party's boats.
Mr Browne said that while the report concluded there was no case for disciplinary action against any individuals, it did say that "many of these individuals could have done more to prevent what happened".
Mr Browne said recommendations had been accepted
BBC defence correspondent Paul Wood said the report had pointed to a central failing by the Navy, in "situational awareness" - of not seeing the approaching threat on radar, and of failing to appreciate that the Iranians were a serious threat to British troops.
An interim ban on serving military and civilian personnel selling stories, introduced after the incident in March, is to become permanent, Mr Browne told MPs, as recommended by the Hall report.
It found there had been a "collective failure of judgment or an abstention of judgment" within the Ministry of Defence.
And it said the Navy should not have taken the decision to allow the media sales - and in future the MoD should take the lead in such cases.
"The acceptance of payment from the media offended the public and their view of the special place of the armed forces in British life," Mr Hall said.
Shadow defence secretary Liam Fox said the government's handling of the issue had made "a national embarrassment incomparably worse" and pointed out that it appeared "no-one is to blame at all".
He blamed the government for abolishing uniformed press officers at the MoD in order to "politicise" the press office - something he said was a mistake that the Conservatives would reverse if voted into government.
For the Liberal Democrats, Nick Harvey added: "This report does conclude that everyone was to blame a bit but no-one was to blame a lot.
"It turned out to be only a national embarrassment. It could have been a national disaster."
Paul Carman, whose son Felix was the officer in charge, told the BBC the report had failed to answer many questions.
He added: "We think he acted in an exemplary fashion, and that basically saved the lives of himself and all the people who were there, so we're really shocked and very depressed about the prospect that there might be some criticism of him."
The Royal Navy crew, eight sailors and seven marines, were on patrol boats in the Gulf on 23 March when they were detained by Iran's Revolutionary Guard.
The Iranians accused the crew of straying into its waters, but the British say they were in Iraqi territory.
They were released nearly two weeks later, but the decision by two crew members to sell their stories was widely criticised by former military figures and the families of those killed or injured in Iraq and Afghanistan.
Mr Browne has already apologised for not blocking the sales of the story. He told MPs he accepted all the recommendations of both reports.