Importer Says Graphics Processing Units Qualify for 1 of 3 Section 301 Exclusions
Nvidia CMP 170 HX graphics processing units should be excluded from Section 301 tariffs on China, importer Atlas Power argued in a Nov. 13 motion for judgment at the Court of International Trade (Atlas Power v. United States, CIT # 23-00084).
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Atlas said its goods fall under one of three Section 301 tariff exclusions for printed circuit assemblies for rendering images onto computer screens, printed circuit assemblies to enhance the graphics performance of automatic data processing machines, or printed circuit assemblies constituting unfinished logic boards.
Atlas defined "logic board" by citing a definition from the Institute of Electrical and Electronics Engineers (IEEE) that describes a logic board as an "assembly of decision-making circuits on a printed-circuit mounting board." The importer said each unit of its graphics processing units meets this definition and is mounted inside a chassis. Its units are "types of logic boards because they consist of assemblies" that meet the IEEE's definition.
The brief added that the units are "unfinished" logic boards since the merchandise was imported "in a condition that required further processing in order to make the merchandise operational at all and to make it function as intended by the user." The goods were shipped without software drivers and without functioning video basic input/output software. Atlas argued that CBP has "uniformly ruled" that devices are unfinished if they are entered without the "functioning software components needed for them to operate as intended by the user."
Atlas added that this treatment of electronic devices is in line with the industry's treatment of software as a "component" of an electronic device.
The importer claimed that its entries meet the exclusion for printed circuit assembles for rendering images onto computer screens because its products are graphics processing unit modules -- items that accomplish this exact function. The U.S. has admitted that the subject goods are graphics processing units, the brief said.
The company argued that the exclusion's reference to "graphics processing modules" results in the conclusion that "the exclusion covers all" graphics processing units. The exclusion references "graphics processing modules" in a parenthetical, teeing up a question of whether the parenthetical is "definitional" or "illustrative" of goods covered by the exclusion. Atlas said that either way, this reference "makes it clear that the provision excludes all GPU modules from 301 Tariffs, regardless of their actual use and regardless of whether they are finished or unfinished."
Lastly, Atlas said its products all meet the exclusion for circuit assembles meant to enhance the graphics performance of automatic data processing machines, arguing that the "undisputed evidence shows that" the goods must be used with an automatic data processing machine. The evidence also supports a finding that the goods can be used to boost many different types of computations, including "high performance computing applications," the brief said.
The goods can enhance the process of "rendering images," thus boosting the graphics performance of an automatic data processing machine and qualifying the item for the exclusion, the brief said.