I talked to the CIII/DD dealer/Manufacturer who I use both for transfers and who has done some restorations for me on DD's about this earlier today.
His advice was not to start with the ATF, instead to determine if it is registered. This can be done through a Class III dealer or manufacturer. If it is not registered or there is no paperwork of any sort, (ie. DEWAT paperwork import, or form 1, war trophy, whatever) indicating that the feds had signed off on the owner's possession of it, then the controlled part, which is the receiver tube, or one receiver sideplate, etc can be cut up and all other parts sold or kept. Only the complete "controlled" part is illegal to possess and if you have the un-registered controlled part then everything else (all other functional parts) are also illegal to possess. In other words, if you have the controlled part and it is cut to BATF specs, you can keep every single piece of the gun... maybe even waiting until some law changes allowing it to be reassembled (we can dream). You could also reassemble on a dummy receiver. A Class III manufacturer can do the "cutting" within legal specs. Good ones can do it so as the receiver is not a total write-off (see below.)
If it is unique, BTW, and it is turned over to ATF intact, they generally keep such weapons and put them in their weapons reference collection or sometimes makes them available via the Federal museum system. Not everything gets destroyed. Home-made Sten Tube guns painted in Krylon will probably get destroyed... a Spanish CIII broomhandle will probably find its way into a reference collection or a museum.
As I mentioned, once the receiver has been cut to spec for legal destruction, all other parts can be saved and kept or sold or put on a dummy receiver. In addition, after cutting, a destroyed receiver can be restored by an FFL07/SOTII to full function and registered as a post-May sales sample, which cannot be owned by a non-licensee and must transfer with PD letter, etc. In other words, it can be transferred between Class III manufacturers or CIII dealers as Post May Samples, with proper paperwork, but cannot be sold to the general public. Seems crazy that you have to cut it to reassemble it to legalize it, but there are restorers (including my dealer friend) who do this kind of restoration/conservation work professionally.
Basically, ATF recognises that these guns are out there but is agreeable to the notion that if they are dealt with so that they are destroyed, and will not fall into criminal use, the intent to comply with the laws is satisfied. His advice to your friend would be to contact a Class III dealer/manufacturer in the area and seek their assistance navigating the BATF. If he wants to do it through an attorney, that is probably not necessary, but can be done.
FYI, I helped deal with an estate for our local bank recently. Gentleman with a huge collection now in hospice and the bank is acting as his guardian. Three weapons in the collection were FA and unregistered. Ultimately, two were handled in the manner above and the receivers were cut to ATF specs and are now 'parts kits.' The third turned out to have old DEWAT paperwork and after BATF involvement they found the serial number in the database, determined it was legal, replacement paperwork was issued and the gun was returned to the vault with the rest of the collection. Neat piece... STG-44... Only one I've ever handled. There may have been a small paperwork fee for the re-issue, but the bank did that, so I don't know if there was.
Finally, I can't speak for every branch office and every agent, but I've been through this several times helping local folks, usually widows dealing with their husbands' collecetions. You would not believe the number of former GI's that still have machine guns in their attics. One guy had an entire box full of live WW2 pineapple grenades. Wife said that he brought them home in 1946 "for fishing." (Does that surprise anyone?) Anyway, in these cases our local ATF office has been excellent to deal with and have bent over backwards to find out status of things and to reassure family, etc. that they will not be targeted for possession, etc. As my dealer pointed out, they recognize that these things are out there and as long as the individual is trying to get things dealt with in the correct way, they are more than happy to help.
The one thing that I would not do is simply 'wrap it up' and keep it, figuring that out of sight makes it ok. As much as I would, personally, want to do that and not give up a neat toy or family heirloom, the whole situation can change when you are aware of what you are doing is illegal and now you are trying to hide it... and while the odds of getting caught are slim, do you want your wife or kids to have to deal with the liability of an Class III item if they have to deal with your estate unexpectedly? Best case, if you deal with it, you learn it was registered and you get a really cool (and very valuable) gun, with paperwork for little or no money and a short (seems long) wait. Worst case, it disappears and you have no liability... and maybe ends up in a museum. If you really want one, they are for sale occasionally and you can buy/own one legally... so that route stays open.
Hope this helps. My two percent of a dollar. Your mileage may vary, offer void in Denmark, etc.
Cheers, Sirhr
