China's securities regulator published draft rules on Wednesday to expand the registration-based initial public offering system, marking a big step towards reforming the world's second-biggest stock market.

The registration-based IPO system, which has been adopted by Shanghai's STAR Market, Shenzhen ChiNext board and the Beijing Stock Exchange in a pilot scheme, will be expanded to the main boards, the China Securities Regulatory Commission said.

The IPO reform is designed "to give the right of choice to the market," and make IPOs more transparent and predictable, the CSRC said in a statement.

Currently, IPOs on the main boards in Shanghai and Shenzhen need a nod from the CSRC under an approval-based system.

The CSRC will consolidate IPO rules for Shanghai, Shenzhen and Beijing bourses.

Under draft rules published on Wednesday, no daily trading limit is set for IPO shares during their first five trading days.

In addition, stocks are eligible for margin trading and securities lending on trading debuts.

The CSRC said the new IPO system doesn't mean quality requirements will be loosened, and that it would vet to see if IPO issuance is in line with China's national industrial policy.