lol..the anti-monopoly bureau? Is that people in this game?
There's an automated function that enforces airlines flooding routes with more than 200% of demand. If you do that, you'll get a message in your game inbox telling you to fix it. When that was introduced, there were issues with say, large widebodies in the jet age being the only type that can fly a particular route nonstop, but demand wasn't sufficient to fly it. The seat limiter allows the route to be flown without being automatically shuttered - thus, it should be used on an exception basis rather than on a regular basis.
Couple examples - 5000nm route in the mid 70's with 130 demand currently flown by a 707. Transition it to DC10 (which costs less to fly) and it's in violation of game rules without reducing seats. Another example woudl be that airport that's 60 miles away from your HQ that would fit perfectly on a 100 seat airplane's schedule, but demand is only 30. Given the length of the route, you'd still make incremental profit at that level, so you might as well fly it.