Some choice quotes from a very long thread on FFA
:"Yes, which is why we had a multi-year fight to get original work allowed on AO3 even though not allowing it was causing problems and alienating chunks of fandom. At the same time, people who didn't know it was banned were busily posting it because it never occurred to them that AO3 would have such a weird rule. (And nobody reported them most of the time because it's not like it was clogging up specific fandom tags.)
Basically, while there are some fandoms where "original het"-as-fanwork is a thing, the best way to understand why original works = fanworks in many parts of fandom is to look at how hard it was to publish tropey m/m romance novels before ebooks became widespread. (Outside of Japan anyway...) There used to be this whole thriving subculture of slash and yaoi writers moving on to original writing but staying in fandom. Nowadays, a lot of people just go publish on Amazon and make a few bucks, but it wasn't like that a decade ago.
Yes, ff.net kicked off original work ages ago, but including "original slash" was the norm on many older multifandom slash archives and mailing lists (and, way back, zines), which means that those old archives AO3 likes to rescue often had problems being imported. Boys in Chains was a particular sticking point: the maintainer wasn't willing to put it on AO3 unless all of her writers were welcome. Meanwhile, this major piece of fannish history remained offline.
The only reason original work wasn't allowed in the first place is that the pro-original work contingent were coming from non-English-speaking fandom and anime fandom, while the anti-original work contingent was from ye olde US TV show megafandoms and was much better represented among OTW staff.
You'll notice that people who think it's a fanwork don't actually call it "original works" except when they're quoting the AO3 canonical. They call it "original fic", "origfic", "original slash", and other terms that make it clear that it is its own distinct thing, separate from both fanfic and non-fannish original writing. And, yes, it does operate very much like people writing fairy tale fic or anthropomorfic or fanfic of songs for Yuletide."
"The TOS does say that it only hosts fanworks:
"Because our long-term plans include hosting fanworks of all kinds, not just fan fiction, we concluded that it was better to draw a line between fanworks and non-fanworks and only host the former, in order to avoid becoming a general repository for all sorts of creative works."
However, it also says (beginning with "however"):
"However, there are a number of varieties of works produced by fans that do not fit comfortably into a narrow definition of fanfiction, fanart, vids, or other types of fanworks. Some of these do fall within our mission. In particular, original fiction that is part of an Open Doors project is allowed, as are types of original fiction and quasi-original fiction produced within a fandom context. Examples include such things as anthropomorfic, original fiction that is produced as part of a fandom challenge, exchange, or charity event, and genres such as Original Slash, Original BL,
and Regency romances produced in Jane Austen fandom."
Which means that you can post original fiction to AO3. It is defined in this case as a fanwork not because it is fanfiction of original work, but because it is original work by fan written in a fannish context.
By definition, then, it is still a canon. And it is like fictionpress and fanfiction.net before they split fictionpress off, not as the arrangement is now."
"I was in the orig slash/orig BL scene back in the day, and it's difficult for me to explain but it was definitely a fannish genre and a fannish community.
A lot of things are different these days -- for one thing, writers are more likely to think of original m/m as something widely/easily publishable, which somewhat changes the conversation and community expectations.
I like that AO3 respects the fuzzy context lines in this situation, and would hate to see fannish-context origfic banned."
It was banned at the start.
We had to explain for years to get it allowed, and it was only by threatening precious ~anthropomorfic~ that the BNFs finally caved and listened to someone from a different part of fandom than themselves."