Individual transferable quota (ITQ) is a management measure that is widely discussed, not least in the reform of the European Common Fisheries Policy. While the system is expected to reduce overcapacity and improve economic performance, questions are raised concerning the future of small-scale fisheries. This paper uses a model for Swedish fisheries (the Swedish Resource Rent Model for the Commercial Fisheries, SRRMCF) where the economics and fleet structure in a potential Swedish ITQ-system are analysed. The model is an optimization model based on linear programming and data from the European Union’s data collection framework. The modelling approach can readily be used by other member states. Three main conclusions can be drawn on how ITQs will affect fisheries:

1. The fishing fleet measured in number of vessels will decrease by approximately 30–50%.

2. Profitability will increase so that the fishing industry will be able to provide competitive wages and make a financial contribution to fisheries management.

3. The system can be designed so that small-scale fisheries are not disadvantaged.

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