The CMM Flags field is referring to Color Management Module flags. In this case, its saying that the ICC profile the JPEG image is tagged with is not embedded. It is possible, although not required, to embed ICC profiles within images, including JPEG images (as according to the very document you linked:)

B.4 Embedding ICC profiles in JPEG files

The JPEG standard (ISO/IEC 10918-1[2]) supports application specific data segments. These segments may be used for tagging images with ICC profiles. The APP2 marker is used to introduce the ICC profile tag. Given that there are only 15 supported APP markers, there is a chance of many applications using the same marker. ICC tags are thus identified by beginning the data with a special null terminated byte sequence, “ICC_PROFILE”.

The length field of a JPEG marker is only two bytes long; the length of the length field is included in the total. Hence, the values 0 and 1 are not legal lengths. This would limit the maximum data length to 65 533. The identification sequence would lower this even further. As it is quite possible for an ICC profile to be longer than this, a mechanism is required to break the profile into chunks and place each chunk in a separate marker. A mechanism to identify each chunk in sequence order is therefore necessary.

The identifier sequence is followed by one byte indicating the sequence number of the chunk (counting starts at 1) and one byte indicating the total number of chunks. All chunks in the sequence should indicate the same total number of chunks. The 1-byte chunk count limits the size of embeddable profiles to 16 707 345 bytes.

Generally speaking, I think images are usually only tagged with ICC profiles, rather than having them embedded, when associated with sRGB, AdobeRGB, or one of the other very common color spaces. It may be necessary to embed a profile if it is a custom profile, one that you do not expect to exist on the machines the image will generally be viewed on.