"There are no laws regulating
"There are no laws regulating engine size. There are, however, recommendations. These recommendations are factored by the US Coast Guard using a very simple formula. Contrary to popular belief, there is no testing involved in this process. It has nothing to do with the actual construction of the boat, including construction method, weight, freeboard, transom height, etc.
As an individual you can install whatever engine you choose. However, if a dealer installs an engine larger than that recommended by the Coast Guard he can be held liable in the event anyone is injured in that boat and it is determined that it was due to being overpowered.
These recommendations only apply to vessels 20' and smaller. This is why most performance O/B boat manufacturers list anything close to 20' at 20'1".
This is where common sense comes into play, although if it were truly common, everyone would have it..."