Bans on marine farming areas will be lifted under proposed reforms announced on Thursday.
Fisheries Minister Phil Heatley told an aquaculture conference in Nelson on Thursday the recommended legislation will remove regulations that have held back the industry.
Mr Heatley says the reforms will allow marine farming outside the current aquaculture management areas.
The minister says the changes could be the most important ever in marine farming, creating a $1 billion industry and potentially worth double that by 2025.
New applications for water space could be made from the first day of the new regime, although growth would not be unfettered.
However, Mr Heatley says new farms will have to satisfy the Resource Management Act.
He says new legislation could be in place by the end of next year.
Submissions on the legislative reforms close on 16 December, ahead of a select committee hearing.
Marine farmers say the planned reforms are the best news they have had in years.
Marine farmers say the industry has stagnated for 20 years and the reforms will encourage new farming and allow mussel farms to be converted for fin fish production.