Methods and systems for performing rate limiting are provided. According to one embodiment, multiple paths are provided between each pair of multi-path load balancing (MPLB) components within a Layer 2 network by establishing overlapping loop-free topologies in which each MPLB component is reachable by any other via each overlapping topology. A first MPLB component receives packets associated with a flow sent by a source component at a particular rate. The first MPLB component forwards the packets to a second MPLB component along a particular path in a network. A congestion metric for the particular path is determined. Based upon the congestion metric for the particular path, it is determined whether the particular path has reached a congestion threshold. In response to an affirmative determination, the source component is instructed to limit the rate at which it sends packets associated with the flow.