Ha - you made me curious. I found this in a Reddit link
“I was competing in point karate tournaments during the '80s and the rules in the movie were a pretty accurate (though simplified) version of reality. Head kicks were legal (straight or roundhouse makes no difference) and punches to the head were categorically illegal. There's really no good reason for the referee in the Johnny/Daniel fight to have called Johnny's clearly illegal face punch a "clash" - the ref should have penalized or disqualified him.
The head kick rule was actually to encourage more difficult, spectacular and crowd-pleasing techniques such as high kicks while distinguishing point karate as a sport from kickboxing in which the fighters wore gloves and were allowed to punch to the head/face. Kickboxing matches often devolved into simple boxing contests, partly because punching is a lot easier and less energy consuming and partly because kickboxing itself was a pretty new sport that attracted fighters who had been boxing since childhood.
That led to new rules such as mandating a minimum number of kicks per round, which in turn led to fighters throwing their kicks (oftentimes pretty sloppy) early in the round and then just boxing.
Point karate avoided that problem (partly) by the simple expedient of not allowing face punches at all, though as with any combat sport rule-set, fighters still gamed the rules. At the height of the type of point-fighting shown in KK1, it was pretty common for fighters to compete almost more like fencers, trusting much more on athleticism and explosive speed within a very limited technical repertoire. Late-'80s point fights often just resolved into who was fastest/luckiest at throwing a lead-leg side kick.