Ex-Persepolis striker reached an agreement on a two-year deal with the Primeira Liga side for a fee of €1.4 million.
Taremi, 27, who played for Persepolis between 2014-2018 where he finished as the Persian Gulf Pro League top scorer twice, scored 19 goals in 38 appearances during a two-season spell at the Qatar Stars league side Al Gharafa.
In his first experience in the European football, Taremi will be joining compatriots Mehrdad Mohammadi – who has recently signed for Desportivo Aves – and Marítimo goalkeeper Amir Abedzadeh in the Primeira Liga.
Rio Ave FC finished seventh in the Portuguese league table in the 2018-19 season.