Upon exiting the condenser, the liquid refrigerant moves through the liquid line. In this case, the liquid line goes to a brazed-plated heat exchanger buried in some insulation. The liquid goes in one side of that heat exchanger and comes out the other side subcooled. On the other part of the heat exchanger, refrigerant flashes in the expansion valves.

On this particular system, the cooling circuit comes from a different rack, but it may come from the same rack as well.

The idea behind mechanical subcooling is to get more capacity out of the same amount of refrigerant. You can also put that load onto another rack. In this case, a medium-temp rack could benefit from better efficiency. (Note: if the other rack is struggling, you may cause the rack with mechanical subcooling to struggle as well.) Mechanical subcooling can also help counter the negative effects of long line lengths and improper pipe sizing.