Villa had been pursuing the Portugal midfielder and were proposing a loan deal with an option to buy, while Palhinha had reportedly agreed personal terms and was keen on a return to the Premier League.
Bayern, however, are demanding a permanent transfer and are understood to want around 30 million euros for the 30-year-old. The German champions paid approximately 51 million euros to sign Palhinha from Fulham in 2024 and are prepared to take a significant loss, but will not sanction another loan.
"We will not be able to reach an agreement with Aston Villa," Eberl said. "It simply doesn't work because we are not in a situation where we have to do everything that other clubs try to impose on us."
Eberl said Bayern had made their position clear from the outset and stressed that there was still time for a solution to be found before the transfer window closes.
"We still have two-and-a-half weeks," he said. "We communicated very clearly from the beginning, both internally and externally, what the situation is. It isn't easy to make decisions like these or deliver messages like these. But it is part of the business."
Palhinha spent last season on loan at Tottenham after failing to secure a regular place at Bayern. He is now expected to continue training with the Bundesliga champions while the club searches for another permanent solution.
Asked directly about the possibility of Villa agreeing a deal, Eberl was emphatic: "There's no chance of an agreement."
