The tariff classification of electrical distribution enclosures from Canada

N331604 April 14, 2023 CLA-2-85:OT:RR:NC:N2:220 CATEGORY: Classification TARIFF NO.: 8537.10.9170 Oscar Palacios C.H. Robinson International 680 Knox Street Torrance, CA  90008 RE:      The tariff classification of electrical distribution enclosures from Canada Dear Mr. Palacios: In your letter dated March 17, 2023, you requested a tariff classification ruling on behalf of your client, CES Corporation. There are two enclosures under consideration that you refer to as Intelliflex Modular Data Centers (IMDC).  The first IMDC under consideration is identified as the IMDC 6.0, which is described as a 60 foot steel container equipped with racking, 24 immersion tanks, 24 Power Distribution Units (PDU), 4 Powerhubs, pumps, valves, piping and wiring, access doors, and lighting.  The second IMDC is identified as the IMDC 3.0, which is described as a 30 foot steel container equipped with racking, 12 immersion tanks, 12 Power Distribution Units (PDU), 2 Powerhubs, pumps, valves, piping and wiring, access doors, and lighting.  Both IMDCs under review are said to be imported separately from their HVAC units, transformers, the Cooling Pods, and the dielectric fluids, which are said to be incorporated into the system at the installation site, post-importation.  However, your request indicates that upon importation, the IMDCs are outfitted with all the necessary internal racking, tanks, piping, electrical systems, and network systems. Based on the information provided, each of the PDUs are described as equipment that supplies power to the machines that are installed and operationally running within the tanks.  Each PDU is made up of numerous contacts, bus bars, fuses, and circuit breakers, and electrically connects the tank-installed machines to the IMDC power bus.  Additionally, each of the Powerhubs are described as cabinets that incorporate numerous contacts, bus bars, circuit breakers, motor starters, speed drive controllers, electrical controllers, motor circuit protectors, receptacles, and more.  The Powerhubs incorporate Human Machine Interfaces, distribution busbars, exterior power connections, and network switches, and function to control the pumps and distribute power throughout the IMDC enclosure. In use, the IMDC 6.0 and IMDC 3.0 will be furnished with electrical machinery of the customer’s choosing at the installation site.  The intended use of the IMDCs is to house and supply power to various types of machinery, which are said to be installed within the immersion tanks where a dielectric fluid and the control systems/pumps maintain cooling from the heat generated by the installed machine’s power consumption.  While each of the IMDC enclosures contain various control and communication apparatus, it is our view that the principal function of the subject enclosures is to distribute and provide power to the machines installed therein.  The specifications provided indicate the maximum voltage of the IMDC enclosures is 415 V. With respect to the type of machines and their bearing on the final tariff classification of the enclosure, you state that the IMDCs can be used to provide power to and cool any electronic devices that require high density cooling, such as servers, cryptocurrency miners, or other IT equipment that can physically fit within the tanks.  Examples of actual industry use, provided by you, include, but are not limited to: Edge Computing; Artificial Intelligence; Cloud Computing; Crypto Mining; Telecommunications; and Cloud Storage.  As such, it is our view that the IMDC enclosures are not dedicated for use in any specific industry or for any particular machine. The applicable subheading for the Intelliflex Modular Data Centers, IMDC 6.0 and IMDC 3.0, will be 8537.10.9170, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Boards, panels, consoles, desks, cabinets and other bases, equipped with two or more apparatus of 8535 or 8536, for electric control or the distribution of electricity…: For a voltage not exceeding 1,000 V: Other: Other: Other”.  The general rate of duty will be 2.7 percent ad valorem. Duty rates are provided for your convenience and are subject to change.  The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at https://hts.usitc.gov/current. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported.  If you have any questions regarding the ruling, contact National Import Specialist Karl Moosbrugger at karl.moosbrugger@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division