Long-term mutual fund sales in Europe – excluding money market vehicles and exchange-traded funds –reached €212.2 billion ($275.9 billion) last year, topping the €175.1 billion figure for the US, according to Lipper, the research firm.

But when money market funds are included in the figures - these funds are an important feature of the US market - the respective totals are €217 billion and €228.5 billion for Europe and the US, the report said.

Among other trends, the continued rise in importance of cross-border funds in Europe is underlined by a finding that such funds attracted inflows of €220.7 billion in 2012, compared with just €9.7 billion for European funds only sold domestically.

The figures demonstrate that Europe’s market, once fractured along national lines with different regulatory and tax regimes, is becoming more international, Ed Moisson, head of UK and cross-border research at Lipper, said.

For years, industry figures have argued that fund "passporting" through vehicles such as UCITS funds would help Europe to develop the same large, efficient fund market as in the US, bringing economies of scale and, hopefully, lower fees overall. 

Lipper defines a cross-border fund - and the international fund market - as those funds sourcing at least 20 per cent of their assets under management from investors in a second market (or more).