External costs issue

External costs are costs generated by transport users and not paid by them but by the society as a whole such as congestion, air pollution, climate change, accidents, noise but also up- and down-stream processes, costs for nature and landscape or additionnal costs in urban areas.
There is a market failure because transport prices are not reflecting their costs and transport users are choosing their transport mode with a wrong price signal. UIC recommends internalisation of these external costs to allow transport users to take the right decisions and the polluter pays principle to optimise the transport sector.