For the last few generations of Pokémon games, you could only use Pokémon caught or bred in the current generation of games for competitive battles. This means that if you wanted to use a Pokémon in a ranked battle in Pokémon Sword and Shield, it would have to be originally caught or bred in one of these games.
With the introduction of Pokémon Home and The Isle of Armor update, this is no longer the case. You can now transfer Pokémon from older games into Sword and Shield and use them in competitive online battles. Here’s how to do it.
You need Pokémon Home
First things first, if you don’t have the Pokémon Home app and a Nintendo Switch Online membership, you can’t do this. Pokémon Home allows you to transfer Pokémon from older games into Pokémon Sword and Shield.
If you want to transfer from an old Nintendo 3DS game, you will also need Pokémon Bank. This is an app for the 3DS that you can store Pokémon in. You can use it to transfer them from the 3DS to the Nintendo Switch.
Meanwhile, if you want to transfer a Pokémon from a game older than Pokémon X and Y (Generation VI), you will need the Pokémon Transfer app on the 3DS. This app transfers creatures from virtual console games and Generation V games to Pokémon Bank.
Making them legal
When you first transfer a Pokémon from an older game into Pokémon Sword and Shield, you won’t be able to use it in ranked battles. To make it legal, you will need to find the NPC at the back of the Battle Tower north of Wyndon City. He stands at the back of the lobby between the two desks by the elevator.
When you talk to this NPC, he will offer to make the Pokémon usable in competitive play in exchange for deleting all the moves it currently knows and replacing them with new ones. Once you do this, you will be able to teach it whichever moves you want and use it in competitive battles.
Source: https://www.dailyesports.gg/how-to-use-pokemon-from-older-games-in-competitive-battles/