At a ceremony on March 25 in Prague, representatives of the library, the Charter 77 movement Havel helped found during communist times, and PACE will sign documents establishing the award.
The prize is to be awarded annually in October and honors Havel's many years as a recognized defender of rights worldwide.
Havel was the last president of Czechoslovakia and became the first president of the Czech Republic in 1993.
The former dissident -- who spent time in prison during the communist era -- also wrote many plays and nonfiction works.
Amnesty International named Vaclav Havel its inaugural ambassador of conscience in 2003.
He died in 2011 at the age of 75.