Pelts round European and British islands (8)
I believe the answer is:
hebrides
'islands' is the definition.
(Scottish islands)
'pelts round european and british' is the wordplay.
'pelts' becomes 'hides' ('hide' can be a synonym of 'pelt').
'round' means one lot of letters goes inside another.
'european' becomes 'E' (abbreviation e.g. EU).
'and' says to put letters next to each other.
'british' becomes 'br'.
'e'+'br'='ebr'
'hides' enclosing 'ebr' is 'HEBRIDES'.
(Other definitions for hebrides that I've seen before include "His breed comes from west of Scotland" , "Strangely, his breed comes from Scottish archipelago" , "Debris he found in islands off NW Scotland" , "Scottish islands" , "Islands off north-west Scotland" .)