Before signing for the LA side, the Welshman is said to have had 'preliminary talks' with Inter Miami, who are owned by another ex-Real Madrid star in Beckham.
The club placed him on its MLS 'Discovery List' but could not agree on personal terms with the five-time Champions League winner, the Miami Herald report.
Players are placed on the 'Discovery List' if a team is interested in signing them, meaning they can then obtain the rights to make a move for them.
MLS teams may sign players on another team's 'Discovery List', but the team that currently has the player on their list will be given the opportunity to make them an offer.
In this instance, LAFC had to acquire Bale's discovery priority rights from Inter Miami after he was placed on their list in exchange for $75,000 in 2023 General Allocation Money.
In another MLS quirk, the club signed the Wales superstar in a deal using Targeted Allocation Money, which means he will not be counted as a Designated Player (a rule allowing MLS clubs to sign up to three players outside of their salary cap).
Ironically, it has been nicknamed the 'Beckham Rule' after it was used for the first time when the superstar moved to LA Galaxy in 2007.
But his new MLS club could not complete a move for the former Southampton and Tottenham forward, who decided instead to make the move to Galaxy's rivals LAFC.
After his transfer was completed, Bale said: "I am extremely excited for this move to LAFC.
"This is the right place for me and my family and the right time in my career, and I cannot wait to get started working with the team and getting ready to win more trophies in Los Angeles."