Question

Commercial

NovaTech Systems GmbH (NovaTech), a German technology company, entered into a PHP 12 million contract with Anino Digital Solutions, Inc. (Anino), a Philippine corporation, to install and configure a customized enterprise resource planning (ERP) system for Anino's Manila operations. NovaTech sent two of its engineers to the Philippines for three months to complete the installation. After NovaTech completed the work, Anino refused to pay the final invoice of PHP 4.8 million, claiming that the installation was defective. NovaTech filed a collection suit before the Regional Trial Court of Manila. In its answer, Anino moved to dismiss, alleging that NovaTech had no legal capacity to sue in the Philippines because it was not licensed to do business in the country. NovaTech countered that the project was a single, isolated transaction and that it was not doing business in the Philippines within the meaning of the Foreign Investments Act. Does NovaTech have the legal capacity to sue? Decide with reason(s).

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