The JUNOS software implementation of Layer 2 circuits supports only the remote form of a Layer 2 circuit; that is, a connection from a local customer edge (CE) router to a remote CE router. Figure 54 illustrates the components of a Layer 2 circuit.
Figure 54: Components of a Layer 2 Circuit

The interfaces shown in Figure 54 are logical interfaces. Packets are sent to the remote CE router by means of an egress virtual private network (VPN) label advertised by the remote PE router. The VPN label transits over either a Resource Reservation Protocol (RSVP) or a Label Distribution Protocol (LDP) LSP (or other type) tunnel to the remote PE router connected to the remote CE router. If you configure RSVP for Layer 2 circuits, you must also configure LDP.
Return traffic sent from the remote CE router to the local CE router uses an ingress VPN label advertised by the local PE router, which again transits over an RSVP and LDP LSP to the local PE router from the remote PE router. LDP is the signaling protocol used for advertising VPN labels.