Snowden, who has sought asylum in Russia, "deserves to be honoured for shedding light on the systematic infringements of civil liberties by US and European secret services," leaders of the parliament's Greens group Daniel Cohn-Bendit and Rebecca Harms said in a statement.
"Snowden has risked his freedom to help us protect ours," they added.
The European United Left/Nordic Green Left group in the European Parliament also nominated Snowden for the 2013 prize, saying "whistleblowers cannot be treated like criminals, they must have our protection."
The winner of the prize will be announced in October.
Last year's award went to detained Iranians, lawyer Nasrin Sotoudeh and film-maker Jafar Panahi, to honour those "standing up for a better Iran."
Past winners of the 50,000-euro (USD 65,000) prize include South African anti-apartheid hero Nelson Mandela and former UN secretary general Kofi Annan.
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