Dogs from British possessions (7)
I believe the answer is:
bassets
'dogs' is the definition.
(basset is a kind of dog)
'british possessions' is the wordplay.
'british' becomes 'b' (abbreviation e.g. in 'BBC').
'possessions' becomes 'assets' (asset is a kind of possession).
'b'+'assets'='BASSETS'
'from' acts as a link.
(Other definitions for bassets that I've seen before include "Hounds with short legs and long ears" , "Dogs" .)