Legal sex (which is really ascribed gender, and starts out as assigned gender at birth) has the exact same problem as gender identity here. As does assigned gender at birth itself (since there are people for whom that is neither male nor female as legally recorded.)
But given the mix of gendered and non-gendered terms in the instruction, its just a product of the fact that both law, and even more the bureaucratic processes and documents supporting its application, is very much not DRY, so “we recognize the existence of non-binary gender” isn’t a point change to the “gender” module of the legal system, rather it requires changes throughout a “code base” that is giant, and has no version control or test suite.
Are you sure you are not committing an is-ought fallacy?
Male/female is determined by chromosomes, either XX or XY.
Seriously however, any link to where this is specified in the way you claim it to be? How does it see SRY gene disorders? If your child is a daughter to you but technically has XY, will the law mandate you to declare her as a son? etc.
This isn’t true legally (where “sex” is really an ascribed gender assigned at birth and possibly updated later for a variety of reasons) or medically (since an individual with a 46,XX karyotype can be male or female medically, as can an individual with a 46,XY karyotype.)