The alleged assault by Prince Alwaleed bin Talal, 56, reportedly took place Aug. 13, 2008, but an investigating magistrate on the popular resort island closed the case last year on grounds of insufficient evidence.
However, a higher provincial court in the Balearic Islands, which include Ibiza, accepted an appeal by the plaintiff and issued an order this year instructing the same magistrate to resume the probe and question the prince as a suspect.
A copy of the order was obtained Wednesday by The Associated Press.
The order said the investigating judge, Carmen Martin Montero, had not questioned Prince Alwaleed in her initial probe. It said tests done by a forensic lab that answers to the Spanish Justice Ministry had found semen in the woman, then 20, and traces of a sedative called nordazepam.
Prince Alwaleed is a leading investor in both Citigroup and Rupert Murdoch's News Corp. media empire, and held 26th place on this year's Forbes list of the world's richest people, with a fortune estimated at $19.6 billion.
The prince's investment firm, Kingdom Holding Company, issued a statement denying the accusations. It said the prince was not even in Ibiza in August 2008 and has not been on the island for more than a decade. In fact, it said he had not even heard about the allegations until Tuesday, through a press query.
"The alleged encounter simply never happened. Indeed, the events could not have happened," read the statement from the Riyadh-based company. "Neither His Royal Highness nor his lawyers were informed or aware of any complaint filed in Ibiza in 2008 or that the same complaint was dismissed in 2010."
The lawyer for the woman, Javier Beloqui, said if the prince was innocent he should just come to Spain to testify or provide a DNA sample for police to test against the DNA found in the woman.
"If he is innocent, it is all over and if not, he will be charged with rape," Beloqui said. "It is as simple as that."
An official at the provincial court in Palma on Mallorca island said she could not confirm Spanish news reports that the investigating magistrate who was ordered to reopen the case has already subpoenaed the prince to come to Spain for questioning. She spoke on condition of anonymity in line with court policy.