The Connection-limit setting is enforced at the TCP level by the ProxySG's IP stack. It's simply a hard limit on the number of TCP connections from a given IP address.
Above enforcement is executed when number of simultaneous TCP connections and/or excessive repeated failed requests from each client IP address that can be established within a specified time frame. If the limits are met the appliance either does not respond to connection attempts from a client already at this limit or resets the connection.
Configuration for the setting is only configurable from Command Line Interface.