Various English papers have claimed that Arsenal and Liverpool have "activated the release clause" for Luciano Vietto, and that Atleti have done so as well. The source all seems to be the Spanish paper AS, which reported yesterday Atleti had decided to do so and that the two EPL clubs were doing so as well.
So what exactly does "activating a release clause" mean in this case? Basically, it means that Villarreal cannot simply say to the three clubs "we don't want to sell Vietto". They have to let Vietto and his agent talk to the three clubs and negotiate a contract with them.
At the same time, though, it remains perfectly possible for Villarreal to offer a new contract to Vietto with improved salary and an improved release clause, and all indications are that's what we've done. Vietto has gained some leverage in the contract negotiations as a result of the potential suitors' interest becoming tangible, however.
To answer questions about Vietto: He does not have an Italian passport, only an Argentine one. He would therefore have to go through the work permit process in the UK, and I believe that has been tightened as of this coming season. Recall that Gabriel was able to get a permit, but that was under the old rules where a tribunal could basically decide a player was of 'international quality' even though he hadn't represented his country yet.
Since Vietto has not yet been called up for Argentina's first team (only their U-20's) I am not sure how easy it would be for him to get this permit. (h/t to _Alam_, who asks a question the English media have comfortably ignored!). I would expect Vietto's first choice would be Atleti anyhow because of the Simeone connection and CL football.
I doubt anything will happen in the next few days, since Vietto and the team are still in Australia (it is really cool that this trip has been a bit of a vacation for the players as well as including a couple of friendlies. Denis Cheryshev posted a little video of whale-watching today: