As you might expect, Pokemon Co. is very protective about their franchise. That includes how it was used in Detective Pikachu. In an interview with Polygon, Detective Pikachu director Rob Letterman mentions some demands Pokemon Co. had for the film's direction.
“Part of [The Pokémon Company’s] conceit for Detective Pikachu was to create a new region, Ryme City, that had a new set of rules. The Pokémon Company wanted to have the Pokémon not be in pokeballs. They wanted a region where humans and Pokémon had a different, elevated relationship where they co-existed. The Pokémon could be human beings’ familiars.”