Okay, Steve has hit the nail on the head. The EFFECT simply states that when this called is applied the ball remains live. There is nothing requiring this to be a "live" ball for the rule to apply.
Until this year, the POE for Passing A Runner began with the comment:
Passing a runner occurs during a live ball. This comment is NOT included in RS #39 this year.
However, I bet if you ask a member of the NUS, you will be told that this rule only applies during a live ball period. Now, here comes the "what if".
On a legitimate over-the-fence home run, when does the ball become dead? If the BR flies pass R5 standing on 1B on his way to 2B, is the BR out for passing while the ball is still technically live? And no, I'm not going to continue this scenario.
