BEIJING, July 4 -- China's securities watchdog on Friday released a draft of proposed changes to the delisting regime for Shanghai and Shenzhen listed companies on Friday.

The new rules allow more voluntary delisting and introduce a mandatory delisting mechanism for companies that have broken the law, according to the China Securities Regulatory Commission (CSRC).

Delisting was introduced into China's Company Law in 1993. The revised Securities Law in 2005 gave the right to delist to bourses. Before this, the right belonged to the CSRC.

A total of 78 listed companies have been delisted so far, but few willingly, said CSRC spokesman Deng Ge.

The draft follows a May initiative by the State Council to improve the capital market, and will help to complete the basic functions of a capital market, Deng said.

The draft also highlights protection of the rights of small investors.