PITTS Enterprises should have paid tariffs on marine chassis built in Vietnam because key components were made in China and trucked over the border, the US Department of Commerce has ruled.

The decision could force Pitts' chassis subsidiary out of business, reports New York's Journal of Commerce.

The decision rejected an appeal by Pitts Enterprises over the practices of its Dorsey Intermodal chassis division, which did business with many US customers, including the South Carolina Ports Authority.

US Customs and Border Protection (CBP) ruled in May 2023 that there was "substantial evidence" that 59 per cent to 69 per cent of the chassis sold through Dorsey Intermodal had origins in China, so tariffs should have been paid on the components even if the chassis themselves were built in Vietnam. At issue were axles, landing gear legs and other parts used to construct a chassis.

CIE Manufacturing, formerly known as CIMC Intermodal, filed the initial complaint.

Pitts appealed CBP's decision to the US Commerce Department. Last May, Pitts told the Journal of Commerce that CBP investigators were misapplying Commerce's landmark ruling in May 2021 that levied antidumping and countervailing duties on Chinese chassis.

Pitts believed the components were not subject to duties because while they were sourced from China, they were "substantially transformed" in Vietnam by its partner, Truong Hai Auto Corporation (THACO).