L3VPNs are provider-provisioned Layer 3 VPNs that extend the customer’s IP (Layer 3) connectivity through an MPLS network. They use extensions to the existing Internet routing protocol BGPv4 to interconnect customer sites.

Like L2VPNs, L3VPNs depend entirely on the PE devices. Unlike L2VPNs, L3VPNs require that the PE devices participate in the customer’s routing algorithms. The PE devices run the routing protocols of the customer’s choice, and they support the IP address scheme that is implemented by the customer.

For unicast or multicast L3VPNs, the signaling for the control plane is Multiprotocol Border Gateway Protocol, which is referred to as “BGP” in the discussions that follow. The PE devices in an L3VPN use BGP signaling to exchange reachability information with one another.

For unicast L3VPNs, the signaling for the data plane is the VPN tunnel. For multicast L3VPNs, the signaling for the data plane is the point-to-multipoint (P2MP) LSP.