The term usually refers to the liability of a sovereign state to another international actor (usually another state) under international law. It may also refer to the liability of an organ of state or public authority in that state's own domestic legal system, typically under special principles within the law of tort.
the financial compensation which a state must pay for wrongs committed by public bodies or public servants
Perhaps the most spectacular outcome of the Exxon Valdez spill was the House's shift to adopt the Senate's protection of state liability systems.
the situation where an EU member state (=any one of the 27 sovereign states that are part of the European Union) is required to pay compensation for a loss which results from the member state's failure to transpose (=to place something into a different setting) an EU directive into domestic law (=the law of the home country)
Enforcement of state liability for violations of rights granted to individuals by EU law is carried out through the national courts of the Member States.