Sacramento -- Gov. Arnold Schwarzenegger signed legislation Friday that will make California the first state in the country to adopt comprehensive controls on fish farming, a growing industry that ocean advocates say is a threat to the marine environment.

The state Fish and Game Commission will issue permits and regulate businesses that want to raise penned fish off the coast under the legislation authored by state Sen. Joe Simitian, D-Palo Alto. The new law is aimed at a new industry, dubbed aquaculture, which has sprung up in coastal states.

California, which does not currently have any coastal fish farms, will develop standards for companies that want to produce fish such as halibut, bass or tuna for the retail market.

Problems have arisen in other states when pen-raised fish have escaped and bred or spread disease among wild populations. Pen-raised fish are also often exposed to chemicals or overfed, or swim in waste, Simitian said.

"Ocean fish farming can now be part of California's future without sacrificing the environment,'' Schwarzenegger said in a statement. "This legislation will lay the groundwork for a new California aquaculture industry to thrive while providing an abundance of healthy food and more jobs in our state.''

Schwarzenegger's signing comes as Congress is also considering regulating the growing industry. Pending federal legislation doesn't have some of the environmental standards called for in the new California law.

E-mail Mark Martin at markmartin@sfchronicle.com.