Security sources said the man, who was not identified, was being questioned by the Shin Bet security agency.
The newspaper said it knew the identity of the man, who comes from the nationalist heartland of South Armagh, but could not name him for legal reasons. It said he was a former IRA member who had switched his allegiance to the so-called Real IRA, which split from the IRA in protest over its 1997 cease-fire.
The splinter group has since been blamed for a series of bombing attacks in Northern Ireland and Britain, including the August 1998 car bombing of Omagh that killed 29 and wounded more than 300.
For years, the IRA had links with Palestinian militant groups, and Irish paramilitaries have recently been accused of training violent groups abroad in exchange for funds.
Three IRA-linked Irishmen are currently on trial in Colombia, accused of training Marxist rebels in terrorist techniques.
They were arrested in August 2001 at Bogota airport after visiting a rebel stronghold. The men deny the charges, and say they were in Colombia to observe the peace process between the rebels and the government.
The three main Palestinian militant groups – Hamas, Islamic Jihad and Fatah – declared a unilateral cease-fire on June 29. Some smaller Palestinian factions have not signed up, however, and all the groups say the truce will collapse unless Israel frees more prisoners and pulls its army out of more Palestinian areas.Share on Facebook