diff --git a/src/main/java/org/opencord/cordvtn/impl/handler/ManagementInstanceHandler.java b/src/main/java/org/opencord/cordvtn/impl/handler/ManagementInstanceHandler.java
index fe30781..f369df1 100644
--- a/src/main/java/org/opencord/cordvtn/impl/handler/ManagementInstanceHandler.java
+++ b/src/main/java/org/opencord/cordvtn/impl/handler/ManagementInstanceHandler.java
@@ -32,6 +32,7 @@
 import org.opencord.cordvtn.impl.AbstractInstanceHandler;
 import org.opencord.cordvtn.api.Instance;
 import org.opencord.cordvtn.api.InstanceHandler;
+import org.opencord.cordvtn.impl.CordVtnNodeManager;
 import org.opencord.cordvtn.impl.CordVtnPipeline;
 
 import java.util.Optional;
@@ -47,6 +48,9 @@
     @Reference(cardinality = ReferenceCardinality.MANDATORY_UNARY)
     protected CordVtnPipeline pipeline;
 
+    @Reference(cardinality = ReferenceCardinality.MANDATORY_UNARY)
+    protected CordVtnNodeManager nodeManager;
+
     @Activate
     protected void activate() {
         serviceType = Optional.of(MANAGEMENT);
@@ -60,116 +64,56 @@
 
     @Override
     public void instanceDetected(Instance instance) {
-        log.info("Instance is detected {}", instance);
-
         VtnService service = getVtnService(instance.serviceId());
         if (service == null) {
             log.warn("Failed to get VtnService for {}", instance);
             return;
         }
-        localMgmtNetworkRules(instance, service, true);
+
+        switch (service.networkType()) {
+            case MANAGEMENT_LOCAL:
+                log.info("LOCAL management instance is detected {}", instance);
+                localManagementRules(instance, true);
+                break;
+            case MANAGEMENT_HOSTS:
+                log.info("HOSTS management instance is detected {}", instance);
+                hostsManagementRules(instance, true);
+                break;
+            default:
+                break;
+        }
     }
 
     @Override
     public void instanceRemoved(Instance instance) {
-        log.info("Instance is removed {}", instance);
-
         VtnService service = getVtnService(instance.serviceId());
         if (service == null) {
             log.warn("Failed to get VtnService for {}", instance);
             return;
         }
 
-        // TODO check if any stale management network rules are
-        localMgmtNetworkRules(instance, service, false);
-    }
-
-    private void localMgmtNetworkRules(Instance instance, VtnService service, boolean install) {
-        managementPerInstanceRule(instance, install);
-        if (install) {
-            managementBaseRule(instance, service, true);
-        } else if (!hostService.getConnectedHosts(instance.deviceId()).stream()
-                .filter(host -> Instance.of(host).serviceId().equals(service.id()))
-                .findAny()
-                .isPresent()) {
-            managementBaseRule(instance, service, false);
+        switch (service.networkType()) {
+            case MANAGEMENT_LOCAL:
+                log.info("LOCAL management instance removed {}", instance);
+                localManagementRules(instance, false);
+                break;
+            case MANAGEMENT_HOSTS:
+                log.info("HOSTS management instance removed {}", instance);
+                hostsManagementRules(instance, false);
+                break;
+            default:
+                break;
         }
     }
 
-    private void managementBaseRule(Instance instance, VtnService service, boolean install) {
+    private void localManagementRules(Instance instance, boolean install) {
         TrafficSelector selector = DefaultTrafficSelector.builder()
-                .matchEthType(Ethernet.TYPE_ARP)
-                .matchArpTpa(service.serviceIp().getIp4Address())
+                .matchEthType(Ethernet.TYPE_IPV4)
+                .matchIPDst(instance.ipAddress().toIpPrefix())
                 .build();
 
         TrafficTreatment treatment = DefaultTrafficTreatment.builder()
-                .setOutput(PortNumber.LOCAL)
-                .build();
-
-        FlowRule flowRule = DefaultFlowRule.builder()
-                .fromApp(appId)
-                .withSelector(selector)
-                .withTreatment(treatment)
-                .withPriority(CordVtnPipeline.PRIORITY_MANAGEMENT)
-                .forDevice(instance.deviceId())
-                .forTable(CordVtnPipeline.TABLE_ZERO)
-                .makePermanent()
-                .build();
-
-        pipeline.processFlowRule(install, flowRule);
-
-        selector = DefaultTrafficSelector.builder()
-                .matchInPort(PortNumber.LOCAL)
-                .matchEthType(Ethernet.TYPE_IPV4)
-                .matchIPDst(service.subnet())
-                .build();
-
-        treatment = DefaultTrafficTreatment.builder()
-                .transition(CordVtnPipeline.TABLE_DST_IP)
-                .build();
-
-        flowRule = DefaultFlowRule.builder()
-                .fromApp(appId)
-                .withSelector(selector)
-                .withTreatment(treatment)
-                .withPriority(CordVtnPipeline.PRIORITY_MANAGEMENT)
-                .forDevice(instance.deviceId())
-                .forTable(CordVtnPipeline.TABLE_ZERO)
-                .makePermanent()
-                .build();
-
-        pipeline.processFlowRule(install, flowRule);
-
-        selector = DefaultTrafficSelector.builder()
-                .matchEthType(Ethernet.TYPE_IPV4)
-                .matchIPDst(service.serviceIp().toIpPrefix())
-                .build();
-
-        treatment = DefaultTrafficTreatment.builder()
-                .setOutput(PortNumber.LOCAL)
-                .build();
-
-        flowRule = DefaultFlowRule.builder()
-                .fromApp(appId)
-                .withSelector(selector)
-                .withTreatment(treatment)
-                .withPriority(CordVtnPipeline.PRIORITY_MANAGEMENT)
-                .forDevice(instance.deviceId())
-                .forTable(CordVtnPipeline.TABLE_ZERO)
-                .makePermanent()
-                .build();
-
-        pipeline.processFlowRule(install, flowRule);
-    }
-
-    private void managementPerInstanceRule(Instance instance, boolean install) {
-        TrafficSelector selector = DefaultTrafficSelector.builder()
-                .matchInPort(PortNumber.LOCAL)
-                .matchEthType(Ethernet.TYPE_ARP)
-                .matchArpTpa(instance.ipAddress().getIp4Address())
-                .build();
-
-        TrafficTreatment treatment = DefaultTrafficTreatment.builder()
+                .setEthDst(instance.mac())
                 .setOutput(instance.portNumber())
                 .build();
 
@@ -177,9 +121,37 @@
                 .fromApp(appId)
                 .withSelector(selector)
                 .withTreatment(treatment)
+                .withPriority(CordVtnPipeline.PRIORITY_DEFAULT)
+                .forDevice(instance.deviceId())
+                .forTable(CordVtnPipeline.TABLE_DST_IP)
+                .makePermanent()
+                .build();
+
+        pipeline.processFlowRule(install, flowRule);
+    }
+
+    private void hostsManagementRules(Instance instance, boolean install) {
+        PortNumber hostMgmtPort = nodeManager.hostManagementPort(instance.deviceId());
+        if (hostMgmtPort == null) {
+            log.warn("Can not find host management port in {}", instance.deviceId());
+            return;
+        }
+
+        TrafficSelector selector = DefaultTrafficSelector.builder()
+                .matchInPort(instance.portNumber())
+                .build();
+
+        TrafficTreatment treatment = DefaultTrafficTreatment.builder()
+                .setOutput(hostMgmtPort)
+                .build();
+
+        FlowRule flowRule = DefaultFlowRule.builder()
+                .fromApp(appId)
+                .withSelector(selector)
+                .withTreatment(treatment)
                 .withPriority(CordVtnPipeline.PRIORITY_MANAGEMENT)
                 .forDevice(instance.deviceId())
-                .forTable(CordVtnPipeline.TABLE_ZERO)
+                .forTable(CordVtnPipeline.TABLE_IN_PORT)
                 .makePermanent()
                 .build();