Voltage hold up time in power supply design for desktop form factor
16 ms is one cycle at 60 Hz.
Realistically, I would imagine that the value was chosen basically by evaluating a few UPSes, and giving a bit of extra headroom. There is no hard rule for switch-over time in a UPS.

You do have to realize that there is a minimum worst-case switchover time, which is largely a function of the fact that the input voltage is AC.
Imagine what would happen if the power failed at 0° or 180° in the AC cycle. Depending on the threshold the UPS uses to detect the AC line being present, it could take several milliseconds for the UPS to detect the AC line is no-longer present.