Inter are making a move for the defender, who they see as cover for senior centre-half Alessandro Bastoni.
Palacios, 21, spent last season on-loan with Independiente Rivadavia, which can trigger 50 per cent of his registration from December.
Fassi told El Mesa Del Futbol: “We are negotiating with Independiente Rivadavia the transfer of Tomás Palacios to Italy.
“There is also an option in Germany.”