The mitzva of shmita is in essence divided into two parts.
The psak of HaGaon Rav Elyashiv pertaining to mechiras chametz and a heter iska was that the documents should all be legally acceptable and that one should not be able to have them pronounced null and void in court. Same is with the din for kinyanim in halacha regarding ownership of land: In order for the kinyan to be complete, one must ensure the legalities are in order as well.
When dealing with ILA, the meaning is a long term lease, not complete ownership.
When it comes to ILA residential lands, there might be a side to consider it buying rather then leasing, yet an agricultural land is considered on a lower level for 3 main reasons:
No. Being that renting is not koneh, the field remains in the owner’s possession and doesn’t belong to the renter. It also works the other way around: If a yid rents his land to a goy, he still needs to do the mitzva of shmita because the land belongs to him.