…Example:
Player A plays a Hand Limit
Player B and C discard down to the hand limit
Player A plays Veto to cancel the Hand Limit for themselves.

Is this allowed?

A: Well, it all depends how Player A was trying to play the Veto. Every Surprise has two different instructions on it. One for when you’re using it to interrupt someone else’s play, and one for if you play it out of your own hand as a regular card on your turn.

First case (the out-of-turn function):

If Player A was trying to use the out-of-turn function to cancel the play of their own card, that’s not allowed. It’s their turn, so they can only use the in-turn function. See also: Can one ever use the out-of-turn function of a Surprise on their own turn?

Note that even if it were another person playing out-of-turn to cancel the card (let’s call them Player D) the Surprise should be played immediately after the card one wants to cancel: in the case of a Hand Limit, that would ideally be before anyone has discarded anything.

Moreover, even if everyone decided to cut imaginary Player D some slack about the timing, and they did let Player D play the Veto after some people had discarded, canceling the Rule would “prevent it from ever taking effect” and everyone would get to take all their cards back as though the Hand Limit had never been played. Long story short: you can’t Veto a rule just for you. The Rule applies to everyone, so when you Veto it, it’s Vetoed for everyone.

Second case (the in-turn function):

If Player A still had a play left on their turn after playing the Hand Limit, they could simply play the Veto for its in-turn function. What it does in this case is let them “discard [their] choice of up to 2 New Rules currently in play”. The Rules discarded don’t even have to be ones that were recently played.

In this case, those rules are not being “canceled” without ever having taken effect, they’re just being discarded. The Rules were played, they took effect for as long as they were in play, and then they were discarded. So if Player A did that, they could simply trash the Hand Limit before their turn ends, thereby avoiding having to discard down at all. Of course, this uses up one of their plays for their turn.