Be careful, people may read and believe what you post, that can be dangerous especially if its just all made up nonsense!
Well here's the facts for you from this very elderly bully.
On the 9th May 2003 the EU passed an order to all member countries to adopt in law the 2002/24/EC Two and Three Wheeler Type Approval legislation. In section 1.2. (h) 250 watt pedelecs were exempted from being considered as motor vehicles, remaining as bicycles. All members including the UK adopted that, in our case on 10th November 2003, but unfortunately the old UK 200 watt law was not rescinded, leaving to a decade of confusion. Since in transport matters the EU law has primacy, most manufacturers supplied 250 watt e-bikes from then on.
On 13th April 2013 to deal with the confusion over the dual law existence, the DfT issued an order to all UK Chief Police Officers not to act against any 250 wat e-bike on grounds of that rating.
Finally on 6th April 2015 an amendment to the 1983 EAPC regulations was passed into law by parliament, changing the power rating to 250 watts to align with the EU legislation.
As for Mercedes, shortly after the turn of the millennium they produced a rear hub motor e-bike rated at 200 watts which ran for a few years, selling through their car showrooms. That not only suited the old UK law but also the Australian market where 200 watts remained the limit until fairly recently.
Therefore I would guess that with the Smart pedelec design they were failing to keep their eye on the ball and were unaware of the worldwide legal changes which have left no country with a 200 watts limit.
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