Xi'an city government issued a new regulation on Tuesday to tighten supervision on residential building construction, three days after a fatal building collapse caused the deaths of seven workers, the Xi'an Evening News said Wednesday.

Residential buildings that lack the proper approval of construction authorities and which violate regulations will be subject to penalties, and their owners will not receive compensation from the government during any demolitions, according to the regulation.

The regulation comes after the sudden collapse of a building resulted in the deaths of seven workers on June 25, when twelve construction workers added an additional floor to an existing 5-storey residence in Weiyang district of Xi'an, capital of Northwest China's Shaanxi Province. Zhang Shuangquan, the owner of the residence, had been informed that his building would be demolished, and had calculated that with one more floor he could derive more compensation from the government, the Xinhua News Agency said Saturday.

"The policy is to regulate housing construction by sending a warning to builders intent on violating regulations," Song Wenqiang, an employee from the Maopo Village Demolition and Relocation Command of Chang'an district in Xi'an, told the Global Times on Wednesday.

"Lax government supervision should also be blamed for the illegally constructed buildings, and the government should stop builders before the buildings are built, not only punish them afterwards. Local authorities should take responsibility for the illegal construction," said Song.