(CNN) -- Libya announced Saturday that it has lifted a ban on visas for European citizens following a similar reciprocal move by the European Union, EU and Libyan officials said.
Libya's reversal of the ban comes a day after Spain -- which holds the current EU presidency -- announced EU Nations would grant visas to Libyans and sent Spanish Foreign Affairs Minister, Miguel Angel Moratinos, to Libya to resolve the dispute.
According to a statement by Spain's Ministry of Foreign Affairs, the presidency "regrets the problems this measure may have caused Libyan citizens" and "hoped that similar situations be avoided in the future."
In a statement on Libya's official news agency (JANA) released Saturday, Libya's Foreign Ministry said it "appreciates" the removal of the ban and hailed it as a defeat of Switzerland.
Switzerland, a member of the 25-state Schengen visa-free area but not part of the EU, requested the initial ban.
A diplomatic rift between Switzerland and Libya contributed to imposing the bans. The conflict began in July 2008, after Hannibal, one of Libyan President Muammar Gaddafi's sons, was arrested in Geneva, accused of mistreating his domestic staff.
According to an EU statement, soon afterwards, Libya arrested two Swiss businessmen, Max Goldi and Rachid Hamdani, and charged them with tax evasion; it then withdrew large sums of money from Swiss banks and suspended granting visas to enter the country to all citizens from the Schengen area.
Spain's Prime Minister Jose Luis Rodriguez Zapatero said he was confident that the dispute would be resolved, and that Goldi, who was sentenced to four months in prison by Libyan authorities after tensions escalated, would be allowed to return to his country "as soon as possible."