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16.13.3.1.3 I2C Loopback Configuration. Loopback on the I2C controller is a
special part of master mode operation with a device that does not contain
internal addresses. Refer to Figure 16-127 for more information. To begin a
loopback transmission, you must prepare a TX buffer descriptor with a data
buffer N+1 bytes long, where N is the number of data bytes to be written back
to the I2C controller. You must also prepare one or more RX buffer descriptors
to receive the N bytes of data. The first byte of the TX buffer descriptor
must contain the address of the MPC823 I2C device’s own address, which is in
the I2CADD register, followed by the write bit asserted (R/W = 0). The
remaining N bytes of the TX buffer descriptor contain the data to be sent and
received by the I2C controller. Next, set the R bit in the TX buffer descriptor
and the E bit in the RX buffer descriptor. Then set the W and L bits in the TX
buffer descriptor. Setting the L bit causes a stop condition to be issued after
this buffer is transmitted to conclude the operation. Set the I bit in the TX
and RX buffer descriptors to enable the transmission and reception status to be
updated in the I2CE register and to enable I2C transmit and receive interrupts
to the core. You must then set the STR bit in the I2COM register to initiate
the loopback operation.

Thanks,
Jochen