The Reds and the Gunners are in the market for a centre-midfielder and have identified the Ivorian as a target
Liverpool and Arsenal have been told they must pay the €40m (£36.3m) buy-out clause to sign Nice midfielder Jean Michael Seri.
The Ivorian star is an alternative to Naby Keita, whose club, RB Leipzig, knocked back a £66m offer earlier this summer.
The Ligue 1 club’s president, Jean-Pierre Rivere, has warned the Reds they must pay the full buy-out clause if Seri is to exit the Allianz Riviera.
“Seri has €40m clause,” Rivere said. “Even if people don’t take clauses seriously, they deserve respect. If a club offers €40m tomorrow, he’ll go.”
Jurgen Klopp was desperate to land the RB Leipzig star but the Bundesliga club stood firm.
Now, the Reds want the Ivory Coast international as a secondary target, but face competition from Barcelona, Arsenal and Paris Saint-Germain.
Liverpool have walked away from a deal for Keita for the time being, after seeing their £66m offer rebuffed.
Arsenal have been monitoring Seri for some time and have been in contact with his representatives in recent weeks with Arsene Wenger on the lookout for any late additions to his squad.
But The Guardian claim the Gunners are unlikely to make an offer unless they sell some players in the coming days.
Barcelona have also been linked with a move for the 25-year-old but it remains to be seen whether they will try and close a deal after they announced the signing of former Tottenham midfielder Paulinho from Guangzhou Evergrande.
A deal for Seri will not be easy though, as Nice have no desire or need to sell after cashing in on Brazilian left-back Dalbert in a deal worth up to £25m.