Originally Posted by J.Edward
My guess as to what happened is since BA/AA were told they could not "force" FF'ers onto ones FF program (this would have been accomplished via the originally proposed AA/BA code-sharing plan) the two airlines lost their way to protect their elite/business customer base. And so, rather than risk poaching (or the loss of 50 prime + 217 non-prime LHR slots) they simply decided to disallow alternate FF redemption/awards on the Trans-Atlantic operations to appease the regulators.
My thinking exactly - BA/AA would be OK in engaging in the usual arms-length FF cooperation, but sought to "cross the line" by implementing a NW/KLM-type FF pooling arrangement that would in fact raise the ire of regulators.