British vessels in Scottish waters (5)
I believe the answer is:
burns
'scottish waters' is the definition.
('burn' is a Scottish term for a stream)
'british vessels' is the wordplay.
'british' becomes 'b' (abbreviation e.g. in 'BBC').
'vessels' becomes 'urns' (urn is a kind of vessel).
'b'+'urns'='BURNS'
'in' acts as a link.
(Other definitions for burns that I've seen before include "Overcooks" , "Tam o' Shanter poet, d. 1796" , "Scottish lyricist" , "Scots poet" , "What Tyger does for Blake" .)