Understanding VPLS VLAN Encapsulation on a Logical Interface
You cannot configure a logical interface with VLAN VLAN VPLS encapsulation unless you also configure the physical device with the same encapsulation or with flexible Ethernet services encapsulation. In general, the logical interface must have a VLAN ID of 512 or higher; if the VLAN ID is 511 or lower, it will be subject to the normal destination filter lookups in addition to source address filtering. However if you configure flexible Ethernet services encapsulation, this VLAN ID restriction is removed.
Ethernet interfaces in VLAN mode can have multiple logical interfaces. In VPLS mode, VLAN IDs from 1 through 511 are reserved for normal VLANs, and VLAN IDs 512 through 4094 are reserved for VPLS VLAN. For 4-port Fast Ethernet interfaces, you can use VLAN IDs 512 through 1024 for VPLS VLAN.
For encapsulation type flexible-ethernet-services, all VLAN IDs are valid.