According to The Echo, the 17-year-old impressed Academy staff during a trial earlier in the season and has been granted permission by his club to travel to Merseyside with his father to undergo a medical at Melwood and agree terms.
The Portuguese club confirmed:
"Sanjoanense informs that, after many months of negotiations, they have reached an agreement with Liverpool for the transfer, outright, of Paulo Alves [Paulinho].
"The agreement comes after a period of testing at the legendary English club, which met the expectations of his parents. It should be formalised in the coming days, with the player allowed to travel to Liverpool in the company of his father."
The young midfielder will remain with Sanjoanense until the end of the season before linking up with the Reds in pre-season.