Computer Parts Importer Says Again Products Are Unfinished GPUs
Importer Atlas Power said April 15 in a reply to a government cross-motion for judgment that “years” after entering its merchandise, the United States was suddenly offering “a recently developed explanation” as to why its products, computer parts, had been assessed Section 301 duties (Atlas Power v. United States, CIT # 23-00084).
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Atlas was ordered to pay the Section 301 tariff rate after its post-summary corrections for four entries of printed circuit assemblies, which it had classified under Harmonized Tariff Schedule subheading 8473.30.1180, were rejected (see 2305020030). It is arguing before the trade court that the government's preferred subheading, 8543.90.35, shouldn’t apply and that its products should have fallen under a Section 301 exclusion for graphics processing units, or GPUs.
Subheading 8543.90.35 covers parts of machines that have individual functions “not elsewhere specified or included,” Atlas said. Subheading 8473.30.1180, on the other hand, covers accessories and parts of automated data processing, or ADP, machines.
It said the government was trying to “have the Court ignore” Additional U.S. Rules of Interpretation 1(c) and 1(a). The former, it said, directs that CBP should prefer an HTS subheading that directly covers a product over a subheading for “parts.” The latter, it said, meant the U.S. couldn’t look to the use to which ADP employed the imported GPUs it kept over how they are “principally used” by its customers.
“The Government argues that the server Atlas used with the CMP 170HX GPUs was a ‘mining machine’ because Atlas installed on its servers a proprietary operating system (‘OS’) optimized for mining cryptocurrency,” it said.
And it argued, “[t]o the extent it may be relevant,” that its own servers were also ADP systems. All the witness testimony in this litigation shows that the servers could be reprogrammed -- a requirement for being defined as ADP systems -- because that cryptocurrency mining-optimized operating system “could be removed and replaced” at any point.
Atlas also argued the U.S., in further challenging the assertion Atlas’ products weren’t GPUs, was seeking to “transport the Court back in time to when GPUs were only used for displaying graphics in video games.”
The government’s witnesses had made “multiple admissions” that the products were GPUs, it claimed.