I'm not sure there was a reason it was in the Rurik rewrite of territories when Kingdoms were limitted to a single state. At the time there hadn't been any principalites for several years. Maybe the thinking was that you couldn't have two sovereign territories within a single state? Now, with the kingdoms basically dividing the US into thirds and some of the smaller territories getting to numbers that rival the current kingdoms, requiring a territory to to be an underling to a home territory that is smaller just seams like a brake on progress to me.
Duke Sir Lassidor Vandolini, KC, BOD treasurer, Imperial Exchequer, Defiance member, BoC of the Kingdom of Vega