[ComicGuy89]

My main concern is not for the fact that this emphasises Rating Battles/Battle Competitions. It's that I can't see how it will be possible to implement a strict penalties system without essentially punishing large swathes of innocent players.

Anytime you log online and trade, be it with GTS, or through Wonder Trade, you have already exposed yourself to the risk of getting hacked Pokemon. There is absolutely no way to tell the difference between a hacked but legal Pokemon, and a legitimate Pokemon. Even strict definitions of legitimate have to concede that somewhere down the Pokemon's breeding line there is a possibility that some hacking was involved in its ancestor.

There are many, many casual players out there, delighted that they suddenly got a lvl 100 shiny Rayquaza in Wonder Trade, who might not suspect or even care that their Pokemon have been hacked. I got a Cobalion once, I haven't bothered to check if it could be legit or not. Should innocent people be punished for the failings of a system along with hackers? What if this guy wants to use his Rayquaza on a Ranked Battle?

The only way to be entirely free of hacking is to never trade Pokemon, which effectively ruins a major point of the games.