Checks by Spain at its border with Gibraltar did not break EU laws, the European Commission has ruled.
Madrid imposed strict controls at the border with the British territory amid a row over the creation by Gibraltar of an artificial reef in disputed waters.
Following complaints from the UK, the commission assessed the legality of the checks on 25 September.
The commission has written to the UK and Spain with recommendations to avoid delays at the border in future.
It advised the countries to work better together to help fight tobacco smuggling and cross-border crime - issues Spain had used as justification for its tougher checks.
A Foreign Office spokesman said: "We welcome the commission's recommendations that the Spanish government should take measures to ensure that the Gibraltar-Spain border functions efficiently, and the commission's commitment to review progress against their recommendations in six months."
While the commission found that no EU laws had been broken at the border, it did say that the crossing point is "challenging, in view of the heavy traffic volumes in a relatively confined space and the increase in tobacco smuggling into Spain".
In its letter to Spain, the commission recommends it makes better use of existing traffic lanes or adds new lanes on the Spanish side of the border and uses more targeted checks "to reduce the large amount of random border controls".
In its letter to the UK, the commission recommends the development of risk-based profiling of travellers and improved laws and safeguards against tobacco smuggling.
Both countries were asked to develop an "exchange of information" with each other about tobacco smuggling.
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