By Patricia Zengerle
Dec 17 (Reuters) - The U.S. Senate on Wednesday passed a compromise version of the fiscal 2026 National Defense Authorization Act, a nearly $1 trillion bill setting policy for the Pentagon that Congress has passed for 65 straight years.
Since the House of Representatives passed it last week, the Senate's approval sends it to the White House, which has said Republican President Donald Trump will sign it into law.
Because it becomes law every year, Congress uses the NDAA as a vehicle
for a wide range of initiatives, from pay raises for troops to competition with China and Russia and major weapons programs. It is closely watched by defense companies, such as Lockheed Martin, RTX Corp and other firms that receive Department of Defense contracts.
Here are some highlights of the bill:
PROGRAMS FOR EUROPE
Trump released a National Security Strategy this month, seen as friendly to Russia and a reassessment of the U.S. relationship with Europe, but lawmakers included several provisions in the NDAA that boost Europe's security.
The bill provides $800 million for Ukraine - $400 million for each of the next two years - as part of the Ukraine Security Assistance Initiative, which pays U.S. companies for weapons for Ukraine's military. It also authorizes the Baltic Security Initiative and provides $175 million to support the defense of Latvia, Lithuania and Estonia.
The bill also limits the Defense Department's ability to drop the number of U.S. forces in Europe to fewer than 76,000 and bars the U.S. European commander from giving up the title of NATO supreme commander.
COMBATING CHINA
The NDAA sets up a process for screening outbound investment in China, requiring Americans and U.S. companies to alert the Department of the Treasury when they back sensitive technologies in China. Treasury would also have more power to block such deals.
The NDAA also includes the "Biosecure Act," which bars some Chinese biotech companies from receiving federal funding.
Amid concerns that China might try to invade Taiwan, the bill fully funds the Taiwan Security Cooperation Initiative at $1 billion, authorizes funding for U.S. forces to continue training for Taiwan and requires the Pentagon to seek to establish a joint program with Taiwan to field drone and anti-drone systems.
The NDAA also authorizes $1.5 billion in new security assistance for the Philippines and contains a measure to limit Trump's ability to lower the number of U.S. forces based in South Korea.
MIDDLE EAST
The bill includes extensive support for Israel, including full funding for cooperative missile defense programs Iron Dome and David's Sling. And it requires an ongoing assessment of international arms embargoes against Israel, such as those responding to the war in Gaza, and an evaluation of whether the U.S. can step in to fill Israel's defense production needs.
The NDAA repeals the tough "Caesar" sanctions imposed on Syria under its former leader, Bashar al-Assad, a move seen as a key part of Syria's economic recovery.
And it repeals the 1991 and 2002 Authorizations for the Use of Military Force against Iraq, an attempt to reassert Congress' role in deciding to send troops into combat.
Lawmakers have long argued that Congress has ceded too much authority to the president over whether troops should be sent into combat by passing and then failing to repeal broad, open-ended war authorizations that presidents have then used to justify military action around the globe.
During his first term, Trump said the 2002 AUMF provided legal authority for the 2020 killing in Iraq of senior Iranian military commander Qassem Soleimani.
BENEFITS FOR THE TROOPS AND 'CULTURE WARS'
The 2026 NDAA includes a 4% pay raise for service members and extends efforts to improve childcare and military housing.
The bill includes some of the "culture war" efforts popular with politicians on the U.S. right. One measure bars transgender women from participating in athletic programs designated for women at U.S. military academies. However, it does not include a ban on Defense Department funding for gender-related medical treatment.
Expansion of coverage for in vitro fertilization for military families is not included. The NDAA also does not contain funding for Trump's plan to change the name of the Department of Defense to the Department of War, an effort estimated to cost $2 billion.
(Reporting by Patricia Zengerle in Washington; Editing by Don Durfee, Nick Zieminski, Matthew Lewis, Rod Nickel)
