Implementing Layer 3 VPN using L3 Tunneling

Do the following to implement L3 VPN using L3 tunneling in your network:

• Configure the VRF for the L3 VPN
• Optionally, configure MPLS label mode to allocate a unique label for each prefix route (defaults to a single label for the named VRF)
• Configure the route distinguisher for each VRF associated with a L3 VPN
• Configure one or more route targets to identify the L3 VPN routes to import and export for each VRF associated with a L3 VPN
• Optionally, specify a VPN identifier to uniquely identify this VPN to which a packet flow belongs to other network features outside of the VPN
• On the global VRF, configure the routed interfaces:
  • A loopback interface with an IPv4 or IPv6 address
  • One or more VLAN interfaces
  • A L3 tunnel interface to each VPN edge router for each BGP peering session
• In global VRF mode, configure an IGP (OSPF) or static routes allowing all LSRs to be reachable within the tunneled domain
• In global VRF mode, configure a static route with the remote BGP address as the destination so that the remote peer loopback address prefers the tunneled interface as the next-hop and not the VLAN interfaces the tunnel uses.
• In global VRF mode, configure BGP to propagate routes from the VRF routing protocol tables
  • Enable the appropriate (IPv4 or IPv6) BGP L3 VPN address family
  • Within the appropriate BGP L3 VPN address family, activate BGP neighbors
  • In non-L3 VPN global BGP address family configuration mode, redistribute routes to the CE routers