This is a bug report. Occured on Babel7 (beta.44).

I've created a reproduction environment here(github). Please see there for detail.

Problem

@babel/register by default cannot apply .babelrc to files located on upper directories than current working directory.

Similar situations will be occurred when using Yarn Workspaces .

babel-register first creates default options (named transformOpts here) which contains ignore and only fields based on the current working directory.

After that, babel-core filters files upper than cwd by programmaticChain here before loading .babelrc.

Workaround

To avoid this behavior, passing babelrc-compatible options to @babel/register works fine.