The theory is that you should have a fair amount of experience, enough to be a Contest Director for an event. As part of the process, you need two other CD's to sign off on your application, certifying that they think you are qualified to fulfill this role.

There is some responsibility and risk that comes with the CD waiver signoff. If you sign someone off who is really not qualified, and they go out and hurt someone, there is a high probability that the lawyers will find you.