Luxembourg will win the most asset management business after the UK leaves the European Union as London becomes less attractive according to market participants.

The majority, 60%, of asset management professionals believe the UK has become less attractive as a fund domicile after the country voted last year to leave the European Union according to a survey sponsored by RBC Investor & Treasury Services at the FundForum International conference in Berlin in June.

The report, How Much Damage is Done, said: “Firms might avoid moving should passporting rights be allowed, and only a quarter of respondents to the survey expected the UK to lose passporting rights.”

Under a passport a firm’s authorisation to do business in one EU member state is recognised by all other member states, without the need to obtain a separate regulatory approval from each country. Passporting procedures depending on both the specific directive applies and the kind of passport that is being requested.

There are 23,532 passports into the UK from another EU states and 336,421 outbound from the UK according to letter from the Financial Conduct Authority to the UK parliament last year.

Approximately £6bn ($7.8bn) or 25% of UK asset management revenues comes from EU-related business that will be directly affected by Brexit according to an analysis from the London School of Economics in March.

Simeon Djankov, executive director of the Financial Markets Group at LSE, said in a report that UK-based asset managers may need to set up subsidiaries across the Europe Union to continue to manage investment funds domiciled there in an efficient manner.

“About a third to half of this EU-related business, £2 to £3bn, may look for a new home,” added Djankov, “US private equity funds Blackstone and Carlyle have announced plans to establish passporting rights in Luxembourg to retain the ability to do business in the EU after Brexit. Morgan Stanley and Aberdeen Asset Management are exploring options for new headquarters in the EU.”

In the RBC Investor & Treasury Services survey only 8% said there would not be any significant move of business from London to rival financial centres with 39% citing Luxembourg as the main beneficiary.

It is possible for firms outside the EU to be given permission to operate in the region, if they are deemed to be authorised in a country with equivalent regulatory standards by the European Commission, or in some cases, member states or their national regulators. However some EU legislation does not contain equivalence provisions, including the Ucits Directive which covers retail asset management.