Many EPs have this rule. If I'm an EP and I am giving away 2 paid bids worth $25,000, I am not going to be making money if 20 of the 25 gyms going for Worlds bids only bring their level 5 teams. They are giving Summit bids and I believe the rule applies to Summit bid participants as well.
Also, EP's are allowed to give a certain number of bids and it is related to how many teams are at their competition. It is smart to ensure not only profitability, but to ensure the ability to give bids in the future.