It would pass, but will be blocked from online battles and being able to breed.
I think you are misinterpreting information a bit, the only thing right about what you said is that transferred Pokemon will be banned from competition (probably due to the rampant hacking in past games).
There is nothing saying they will be banned from random online and in-game mechanics like breeding. Banning breeding would be idiotic as many people transfer to complete the Pokedex.
Experience beats bias, but words on the Internet are meaningless. 3DS XL FC: 2492-4470-1418 / White 2 FC: 0047-4149-5185 / White FC: 0348-0626-6780