in planescape, magic items begin to loose their bonuses, the farther you get from the plane they were forged on. thus, were one to forge a +3 shortsword on a prime material plane, (AIRC) on the astral or etherial, its bonus would decrease to +2, and so forth, until you ended up dead in the Beastlands with a seemingly useless blade. thus, one would presume that this sword essentially is a longsword +5 forged in the outer planes, leaving it with a +1 on the prime material, but whose bonuses will effectively increase as you move out, rather than decrease.
although really, one would assume the 'sword of the planes' would be a sword immune to such shifts in power. ah well.