Yes, and I don't see the problem. If you get a place but you repeatedly fail at exams, it is better to offer the opportunity to other student. Where I life, you have a limited number of chances to pass the exam for a class. If you fail more than 6 times, you are out. And you need to pass all the classes. It is reasonable.

Compared to that, in US you have limitless chances IF you can afford it. That means that, in practice, many people would only have a chance or two at most to pass. Because they can't afford more. So instead they drop. Or they drop even after passing their classes, because they can't afford to finish... It is decided on money, not work and capacity.