The United States has suspended hearings next week on a proposed alliance between American Airlines and British Airways because Britain is dragging its feet on a bilateral aviation accord, the Department of Transportation said yesterday The three-day hearings, to have taken place before the Federal Trade Commission, have been indefinitely postponed, said department spokesman Mr William Mosley.

"Since the United Kingdom was not prepared to resolve any of the core issues, we postponed the hearings" he said.

Under an open skies deal market forces rather than government regulations would determine pricing, routes and scheduling.