Looks like limit is set here:

https://source.chromium.org/chromium/chromium/src/+/main:components/password_manager/core/browser/import/password_importer.cc;drc=45c4058fd01d05e82e7bc6ced568f028d9b3b104;l=71

and the check for that limit is here:

https://source.chromium.org/chromium/chromium/src/+/main:components/password_manager/core/browser/import/password_importer.cc;l=81

Code shows that it's definitely done on purpose.