Once that comes into effect, the Spanish/Gibraltarian police will be allowed to enter Gibraltar/Spain when in hot pursuit and to continue observation operations (https://en.wikipedia.org/wiki/Schengen_Area#Police_and_judic...)
How would that even work, a border where some persons have to identify themselves while others can cross freely? That would catch only the truly stupid criminals. (But what do I know? Reading https://en.wikipedia.org/wiki/Schengen_Area makes my head go dizzy with all the exceptions. You can sort-of sneak into the Schengen area via Svalbard or the Faroe islands, for example, so some holes needed to be closed there)
Such a system only work when everybody already has to show ID, as is the case when traveling by boat or plane to and from the parts of Spain in Africa (that’s a security check, not a border check. https://en.wikipedia.org/wiki/Schengen_Area#Air_travel)