Senate, House Defense Bills Propose Restrictions on U.S. Warships Built in Foreign Yards; Legislation Limits Navy Secretary’s Ability to Rename Ships

WASHINGTON, D.C. — Congressional defense committees voted to pump the brakes on the Trump administration’s push to buy foreign-built warships, USNI News has learned.

House and Senate authorizers and House appropriators are placing limitations on the executive’s ability to pursue foreign warship designs built in allied shipyards abroad.

The Senate Armed Services Committee’s mark of the Fiscal Year 2027 defense policy bill removes the presidential waiver authority from Title 10 that allows the commander-in-chief to use an undefined “national security interest” exception to buy foreign warships for use in the U.S. armed forces.

However, the committee is extending the authority to the Pentagon to buy auxiliary ships from allied shipbuilders. In a similar arrangement to the one the Trump administration is implementing under the Ice Pact cooperative agreement between the U.S., Finland and Canada for icebreakers, the Senate would allow the Defense Department to acquire tankers, bulk fuel vessels and roll-on/roll-off ships from foreign shipyards

“Those can follow the ICE Pact model where they’ll build up to two overseas, which would be concurrent with foreign direct investment into U.S. yards for subsequent ships to be brought, including their supply chain, and other guardrails,” a Senate Majority official told reporters Thursday.

Under the arrangement, the foreign yard building the auxiliaries must be in a country that is a U.S. treaty ally, according to text of the legislation obtained by USNI News.

White House Office of Management and Budget Director Russ Vought has touted this arrangement as the so-called “Finland model” in public appearances.

“We’re going to continue working with OMB and with the appropriators on that issue immediately,” another Senate Majority official said last week.

Prior to issuing contracts for the auxiliaries, the Defense Secretary must give the congressional defense panels a report that lays out the acquisition plans by class of ships, including where and what yard those vessels would get constructed. The secretary must also explain how the Pentagon will safeguard both classified and controlled unclassified information as those ships are under construction and how it will bring the industrial base and supply chain in the foreign country back to the U.S. for the subsequent ships in the class, according to the text.

Should the Defense Department opt to build in an allied yard, the Defense Secretary also must determine that the ships would get built faster than they would in the United States, unless there is a “readiness or force posture” reason to build them abroad.

The provision in the upper chamber’s draft version of the National Defense Authorization Act comes after the Trump administration in its FY 2027 budget rollout revealed plans to pursue foreign designs for U.S. Navy frigates and destroyers that could be built in shipyards abroad. Specifically, the administration is considering designs and shipyards in South Korea and Japan, USNI News reported in April.

Congressional Democrats have derided the plan, which has also received criticism from the Shipbuilders Council of America. Rep. Jared Golden (D-Maine), whose district is near General Dynamics Bath Iron Works, said last month he would not support any proposal that sends shipbuilding abroad and that the Navy should axe the plan.

Earlier this month, during the mark up of the House Armed Services Committee’s draft of the FY 2027 policy bill, Golden successfully included an amendment barring any authorized funding from going toward contracts that would buy an American warship built in a foreign yard.

House appropriators also addressed the push to build ships abroad by including language in their draft of the FY 2027 spending bill that would prevent any funds allotted from going toward building ships in “foreign facilities” and “foreign shipyards.”

It’s unclear the Trump administration will respond to the multiple provisions. To begin the path toward foreign shipbuilding, the Navy is seeking $1.85 billion in research and development money as part of the reconciliation piece of the FY 2027 budget proposal. For the second year in a row the Trump administration submitted a defense budget split between a discretionary base request and reconciliation. Reconciliation is a separate budget process from the annual authorization and appropriations efforts. Lawmakers still have to work out a deal to move forward on reconciliation.

The SASC is also placing new limitations on the Secretary of the Navy’s authority to rename ships. The service’s top civilian can only change the name of a ship if that person is confirmed by the Senate, meaning an acting secretary like Hung Cao could not rename a vessel, according to the bill’s language. Should the service secretary want to change a ship name, they must provide a “compelling reason” for doing so and give House and Senate authorizers a report justifying that change, according to the text of the legislation.

In the mark of the NDAA, Senate authorizers opted not to meet the Navy’s request for $1 billion in advance procurement funding for the new Trump-class battleship.

“We believe that that was early to need for that program,” the first Senate Majority official said of the funding.

The panel did authorize $850 million in research and development for the battleship and chose not to put restrictions on the program, the official said. House authorizers in their mark of the bill mandated a study about how buying the nuclear-powered Trump-class battleship could affect the nuclear and shipbuilding industrial bases.

The SASC authorized a second Arleigh Burke-class destroyer. The Navy only sought one Flight III Burke in the original submission. The committee also “supports the need for a new [multi-year procurement] contract beginning in fiscal year 2028 for up to 15 ships,” according to the committee’s executive summary of the bill. The current multi-year procurement for destroyers goes through FY 2027.

The bill, which lawmakers passed out of committee in an 18-9 vote, authorizes a $1.15 trillion national defense topline, meeting the Trump administration’s original submission. The nine votes against the legislation is a departure for what has historically functioned as a bipartisan committee. Multiple Democrats – including Sens. Tim Kaine (D-Va.) and Mark Kelly (D-Ariz.) – voted against the bill out of committee.

“As glad as I am about portions of this bill, I remain laser-focused on ending the Iran War, not rewarding the Pentagon by authorizing a blank check for more of it,” Kaine said in a statement last week. “Unless this war ends, or Congress votes to authorize it, I will remain a ‘no’ on this legislation when it comes before the full Senate for a vote.”

The upper chamber will need to work out differences with the House during a conference process later this year.

Meanwhile, the House Appropriations Committee also unveiled its Fiscal Year 2027 defense spending bill last week. The draft of that legislation includes a provision about the battleship, mandating the Navy Secretary prove to the four defense committees that the lead ship’s weapons systems “are at a sufficiently mature technology readiness level,” according to the text of the bill.

The HAC allotted funding for one destroyer, adhering to the Navy’s request. The panel increased research and development funding for the Navy’s sixth-generation F/A-XX fighter to $915 million. The Navy sought $140.6 million for the program across the discretionary and reconciliation request.

The Senate Appropriations Committee has yet to release its version of the FY 2027 defense spending bill.