I believe that it's more nuanced than that (this is from the context of German regulations):

In the old days, reflectors and diffractors were rather crude and light distribution wasn't even at all. Regulation was setting a light intensity limit for the arc above the cutoff, assuming that the brightest spots would be just that, unintended brightness outliers. And when those would comply with the limit, the typical brightness hitting the eyes of oncoming traffic would be much lower.

Now reflector design is SO much better manufacturers striving to make their buyers happy can make lights pushing out photons exactly at that old regulatory limit over the entire cutoff area, and with a precise jump where the cuttoff stops. That's awesome for the person behind the wheel ("best lights I ever had!"), technically within the old limits and a terribly blinding for everybody else.