Adriano Galliani admits Milan can not compete financially with Manchester City for the signature of Ronaldinho.
New Barcelona coach Pep Guardiola revealed on Tuesday that he is prepared to offload Brazilian playmaker Ronaldinho over the summer.
Milan have been long-time admirers of the 28-year-old, while Premier League club City have confirmed their interest in the former Paris Saint Germain ace.
Chelsea have also been linked with a bid after Ronaldinho's compatriot Luiz Felipe Scolari was appointed manager and there have been reports that the player is wanted by Los Angeles Galaxy.
Barcelona have yet to accept any bids for Ronaldinho, but Milan vice-president Galliani concedes the Italian giants can not match the wages City are prepared to offer.
"For now Italian football is ranked fourth in Europe behind England, Spain and Germany," Galliani told the Gazzetta dello Sport.
"Unfortunately we can't compete with the wages they offer.
"It is the way our football is going unless we change things.
"We'd like to offer Ronaldinho from Barcelona a chance of playing for us.
"Manchester City, though, have offered the Brazilian 12million euros (£9.5million) a year. How can we compete?
"Well, only if they give him to us for free!"