The Label type in MusicBrainz has evolved to encompass various other company-type entities that are not actually valid Labels for use on a Release. However, editors are free to choose any Label entity when adding a Label to a release, with the result that releases are frequently found added to labels that are actually publishers, holding companies etc.

Inappropriate  choice of labels could be reduced if the server were to raise a warning when adding a label to a release that was not either:

• Imprint
• Production (or a subtype)

Some types of labels are arguably never valid as release labels, so might be blocked entirely eg. Publisher, Rights Society. Others eg. Distributor do legitimately release albums (typically compilations) though perhaps there should be two separate labels in such cases.

At present, this issue is being addressed on a case-by-case basis by adding disambiguation comments with comments like "file no releases here", but it's imperfect, and usually only applied to holding companies. Eg. see Warner Bros.
There is a discussion of a similar issue in the forums here https://community.metabrainz.org/t/label-question-imprint-vs-company/375537/10