Chinese dissident Liu Xiaobo dies in custody, struck by liver cancer

* Dissident Liu Xiaobo suffered multiple organ failure

* Had been moved to hospital in June with late-stage liver cancer

* Liu jailed for 11 years in 2009 over pro-democracy charter

* Beijing criticised for not letting Liu seek treatment abroad

* China angered by 2010 award of Nobel peace prize (Inserts dropped word "bowed" in paragraph 30)

By Joseph Campbell

SHENYANG, China, July 13 (Reuters) - Chinese Nobel Peace Prize laureate Liu Xiaobo, a prominent dissident since the 1989 Tiananmen Square pro-democracy protests, died on Thursday after being denied permission to leave the country for treatment for late-stage liver cancer.

Liu, 61, was jailed for 11 years in 2009 for "inciting subversion of state power" after he helped write a petition known as "Charter 08" calling for sweeping political reforms.

Mourning his death, German Chancellor Angela Merkel said Liu was a "courageous fighter for civil rights and freedom of expression", while the French, British and U.S. governments called on China to allow Liu's family to move around freely.

Already seriously ill, Liu, a thorn in the ruling Communist Party's side since he helped negotiate a deal to allow protesters to leave Tiananmen Square before troops and tanks rolled in, was moved last month from prison to a hospital in the northeastern city of Shenyang.

The Shenyang Bureau of Justice said in a brief statement on its website that Liu had suffered multiple organ failure and efforts to save him had failed. Though allowed out on medical parole he was never freed, spending his final days in the hospital surrounded by security guards.

Teng Yue'e, the chief doctor treating Liu, told a news conference in a nearby hotel that Liu died at 5:35 PM (0935 GMT) surrounded by his family.

"When Mr. Liu Xiaobo died, he was not in any pain at that moment, he was very much at peace, because all of his relatives said their goodbyes beforehand. So when we saw him we thought he was very much at peace," Teng said.

The leader of the Norwegian Nobel Committee which, to Beijing's ire, awarded Liu the peace prize in 2010, said the Chinese government bore a heavy responsibility for his death.

"We find it deeply disturbing that Liu Xiaobo was not transferred to a facility where he could receive adequate medical treatment before he became terminally ill," said Berit Reiss-Andersen in an emailed statement.

China said at the time that Liu's award was an "obscenity" that should not have gone to a man it called a criminal and a subversive.

Carl von Ossietzky, a pacifist who died in 1938 in Nazi Germany's Berlin, was the last Nobel Peace Prize winner to live out his dying days under state surveillance.